EXHIBIT 2.1
STOCK AND ASSET PURCHASE AGREEMENT
BY AND BETWEEN
APPLIED MATERIALS, INC.
AND
METRON TECHNOLOGY N.V.
Dated as of August 16, 2004
TABLE OF CONTENTS
PAGE
ARTICLE I PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES ....................................... 2
1.1 Purchase and Sale of Assets................................................................... 2
1.2 Excluded Assets............................................................................... 2
1.3 Assumption of Liabilities..................................................................... 3
1.4 Excluded Liabilities.......................................................................... 4
1.5 Purchase Price Allocation..................................................................... 4
ARTICLE II PURCHASE PRICE AND PAYMENT.................................................................... 5
2.1 Amount of Purchase Price...................................................................... 5
2.2 Payment of Purchase Price..................................................................... 5
ARTICLE III CLOSING AND TERMINATION....................................................................... 5
3.1 Closing Date.................................................................................. 5
3.2 Termination of Agreement...................................................................... 5
3.3 Procedure Upon Termination.................................................................... 6
3.4 Effect of Termination......................................................................... 6
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................. 7
4.1 Organization and Good Standing................................................................ 7
4.2 Authorization of Agreement.................................................................... 7
4.3 Capitalization................................................................................ 8
4.4 Purchased Companies and their Subsidiaries.................................................... 9
4.5 Corporate Records............................................................................. 10
4.6 Conflicts; Consents of Third Parties.......................................................... 10
4.7 Ownership and Transfer of Shares.............................................................. 11
4.8 SEC Documents; No Undisclosed Liabilities..................................................... 11
4.9 Information Supplied.......................................................................... 13
4.10 Absence of Certain Developments............................................................... 14
4.11 Taxes......................................................................................... 16
4.12 Real Property................................................................................. 19
4.13 Tangible Personal Property.................................................................... 20
4.14 Intellectual Property......................................................................... 21
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TABLE OF CONTENTS
(CONTINUED)
PAGE
4.15 Material Contracts............................................................................ 25
4.16 Employee Benefits Plans....................................................................... 26
4.17 Employees and Labor........................................................................... 30
4.18 Litigation.................................................................................... 30
4.19 Compliance with Laws; Permits................................................................. 31
4.20 Environmental Matters......................................................................... 31
4.21 Insurance..................................................................................... 32
4.22 Inventories; Receivables; Payables............................................................ 33
4.23 Related Party Transactions.................................................................... 33
4.24 Customers and Suppliers....................................................................... 33
4.25 Banks......................................................................................... 34
4.26 Vote Required................................................................................. 34
4.27 Financial Advisors............................................................................ 34
4.28 Opinion of Financial Advisor.................................................................. 34
4.29 Title to Purchased Assets; Sufficiency........................................................ 34
4.30 No Misrepresentation.......................................................................... 34
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER................................................... 35
5.1 Organization and Good Standing................................................................ 35
5.2 Authorization of Agreement.................................................................... 35
5.3 Conflicts; Consents of Third Parties.......................................................... 35
5.4 Litigation.................................................................................... 36
5.5 Investment Intention.......................................................................... 36
5.6 Financial Advisors............................................................................ 36
ARTICLE VI COVENANTS AND AGREEMENTS...................................................................... 36
6.1 Access to Information; Confidentiality........................................................ 36
6.2 Conduct of the Business Pending the Closing................................................... 37
6.3 Consents...................................................................................... 41
6.4 Filings with Governmental Bodies.............................................................. 41
6.5 Other Actions................................................................................. 42
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TABLE OF CONTENTS
(CONTINUED)
PAGE
6.6 Non Negotiation; Non-Solicitation............................................................. 43
6.7 Publicity..................................................................................... 45
6.8 Company Stock Options and Other Awards........................................................ 46
6.9 Use of Name................................................................................... 46
6.10 Environmental Matters......................................................................... 46
6.11 Employee Bonus Incentive Plan................................................................. 46
6.12 Updated Schedules............................................................................. 47
6.13 Preparation of the Company Proxy Statement; Shareholders Meeting.............................. 47
6.14 Employee Benefits............................................................................. 48
6.15 Insurance..................................................................................... 49
6.16 Intercompany Items............................................................................ 49
6.17 Liquidation and Satisfactions of Claims....................................................... 49
6.18 Indemnification, Exculpation and Insurance.................................................... 50
6.19 Certain Contracts............................................................................. 50
6.20 Agreements Regarding Certain Taxes............................................................ 51
ARTICLE VII CONDITIONS TO CLOSING......................................................................... 54
7.1 Conditions Precedent to Each Party's Obligations.............................................. 54
7.2 Conditions Precedent to Obligations of Purchaser.............................................. 55
7.3 Conditions Precedent to Obligations of the Company............................................ 57
ARTICLE VIII DOCUMENTS TO BE DELIVERED..................................................................... 58
8.1 Documents to be Delivered by the Company...................................................... 58
8.2 Documents to be Delivered by the Purchaser.................................................... 59
ARTICLE IX MISCELLANEOUS................................................................................. 59
9.1 Certain Definitions........................................................................... 59
9.2 Non-Survivability of Representations and Warranties........................................... 69
9.3 Payment of Sales, Use or Similar Taxes........................................................ 70
9.4 Expenses...................................................................................... 70
9.5 Specific Performance.......................................................................... 70
9.6 Further Assurances............................................................................ 70
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TABLE OF CONTENTS
(CONTINUED)
PAGE
9.7 Submission to Jurisdiction; Consent to Service of Process;.................................... 70
9.8 Entire Agreement; Amendments and Waivers...................................................... 71
9.9 Governing Law................................................................................. 71
9.10 Table of Contents and Headings................................................................ 71
9.11 Notices....................................................................................... 71
9.12 Severability.................................................................................. 72
9.13 Binding Effect; Assignment.................................................................... 73
9.14 Counterparts.................................................................................. 73
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EXHIBITS
Exhibit A - Form of Voting Agreement
Exhibit B - Form of Non-Competition Agreement
Exhibit C - Form of Employee Bonus Incentive Plan
Exhibit D - Form of Assignment and Assumption Agreement
Exhibit E - Form of Indemnity Agreement
ANNEXES
Annex A - Purchased Companies
Annex A-1 - Subsidiaries
Annex A-2 - Joint Ventures
Annex B - Shareholders
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STOCK AND ASSET PURCHASE AGREEMENT
This STOCK AND ASSET PURCHASE AGREEMENT is dated as of August 16,
2004 (the "Agreement") by and between Applied Materials, Inc., a Delaware
corporation (the "Purchaser") and Metron Technology N.V., a company organized
under the laws of The Netherlands (the "Company"). Capitalized terms used but
not otherwise defined herein have the meanings ascribed to such terms in Section
9.1.
RECITALS:
A. The Company is principally engaged in the business of
marketing, sales, service and support solutions to semiconductor materials and
equipment suppliers and semiconductor manufacturers and the marketing, sale,
manufacture and support of early generation semiconductor equipment (the
"Business") which operates through the direct or indirect ownership of (i) all
of the issued and outstanding shares (collectively, the "Shares") of capital of
the companies set forth on Annex A under "Purchased Companies" hereto (each a
"Purchased Company" and collectively, the "Purchased Companies"); and (ii) the
Subsidiaries of the Purchased Companies listed on Annex A-1 and Annex A-2.
B. The Company desires to sell, transfer and assign to Purchaser,
and Purchaser desires to purchase, acquire and assume from the Company, the
Purchased Assets and the Assumed Liabilities (each as defined below), for the
purchase price and on the terms and subject to the conditions hereinafter set
forth (the "Transaction").
C. Each of the Managing Board of the Company (the "Managing
Board") and the Supervisory Board of the Company (the "Supervisory Board" and
together with the Managing Board, the "Company Boards") has unanimously
determined after taking into account the interests of the shareholders,
employees and other stakeholders of the Company that this Agreement and the
Transaction are reasonable, proper and advisable and are fair to, and in the
best interests of the Company, the Business and the Company's shareholders,
employees and other stakeholders.
D. In order to induce the Company and Purchaser to enter into
this Agreement, concurrent with the execution of this Agreement, certain
shareholders of the Company, listed on Annex B, have entered into Voting
Agreements, in substantially the form attached hereto as Exhibit A (the "Voting
Agreements").
E. As soon as practicable following the Closing, the Company
intends to: (1) wind up its affairs, satisfy all valid claims of creditors and
others having claims against the Company, and distribute any remaining assets
(including any remaining Purchase Price) to its shareholders; (2) request
delisting of its shares from Nasdaq; and (3) be dissolved and liquidated.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter contained, the parties hereby agree as
follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES
1.1 Purchase and Sale of Assets. On the terms and subject to the
conditions set forth in this Agreement, at the Closing Purchaser shall (or shall
cause its designated Affiliate or Affiliates to) purchase, acquire and accept
from the Company and the Company shall (and in the case of Third Party Shares as
defined in Section 4.7, the Company shall cause the holders of such Third Party
Shares to) sell, transfer, assign, convey and deliver to Purchaser (or its
designated Affiliate or Affiliates) all of the Company's (or such holder of
Third Party Shares'), right, title and interest in, to and under the Purchased
Assets, free and clear of all Liens except for Permitted Exceptions. "Purchased
Assets" shall mean all of the business, assets, properties, contractual rights,
goodwill, going concern value, rights and claims of the Company, wherever
situated and of whatever kind and nature, real or personal, tangible or
intangible, whether or not reflected on the books and records of the Company
(other than the Excluded Assets), including without limitation each of the
following assets:
(a) all stock or equity interests in any Person, including without
limitation the Shares and the Third Party Shares;
(b) all of the Company's rights in, to and under the Company
Intellectual Property and the Company Technology, including without limitation
the Company Intellectual Property and the Company Technology set forth on
Schedule 1.1(b);
(c) all rights of the Company under any Contracts relating to the
Business, including, without limitation, those Contracts set forth on Schedule
1.1(c) (other than those Contracts which become Excluded Assets pursuant to
Section 6.3), provided, with respect to the Contracts set forth or referred to
in Schedule 6.19, only to the extent such Contracts become Purchased Assets in
accordance with Section 6.19 (the "Purchased Contracts");
(d) all cash and cash equivalents, except to the extent expressly
provided in Section 1.2(c);
(e) all accounts receivable and other current assets;
(f) all Permits, to the extent transferable under applicable Law;
(g) all Documents;
(h) all deposits, prepayments and rights to refunds (including
without limitation any refunds relating to Taxes); and
(i) all other assets, if any, reflected on the Balance Sheet or
otherwise used in connection with the Business.
1.2 Excluded Assets Nothing herein contained shall be deemed to
sell, transfer, assign or convey the Excluded Assets to Purchaser, and the
Company shall retain all
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right, title and interest to, in and under the Excluded Assets. "Excluded
Assets" shall mean each of the following assets:
(a) any Contracts that become Excluded Assets in accordance with
Section 6.3 or Section 6.19;
(b) the Initial Cash Payment;
(c) other cash and cash equivalents of the Company at the Effective
Time, in an amount equal to the sum of (i) the aggregate cash payments received
by the Company from and after the date of this Agreement and prior to the
Effective Time upon the exercise of Warrants (as defined in Section 4.3(a)) and
options issued under the Company Stock Plans (as defined in Section 4.3(a)) and
(ii) Two Million Dollars ($2,000,000) in cash held by the Company as of the
Effective Time;
(d) the Contracts set forth on Schedule 1.2(d) (the "Specified
Contracts");
(e) all cash received by the Company after the Effective Time under
the ESPP and upon the exercise of Warrants and options issued under the Company
Stock Plans;
(f) the Company's rights under this Agreement, the Assignment and
Assumption Agreement and the Indemnity Agreement;
(g) treasury shares in the Company; and
(h) the Company's articles of association, by-laws, minute books,
corporate seal and other corporate records relating to its corporate
organization and capitalization.
1.3 Assumption of Liabilities On the terms and subject to the
conditions set forth in this Agreement, at the Closing, Purchaser shall (or
shall cause its designated Affiliate or Affiliates to) assume, effective as of
the Closing, all of the Liabilities of the Company as of the Effective Time
(other than Excluded Liabilities (as defined in Section 1.4 hereof)), and
including, without limitation:
(a) any Liability for United States federal or Netherlands income
taxes arising from the Closing of the transactions contemplated by this
Agreement including any Liabilities for corporate income Taxes resulting from
payments from the Purchaser to the Company pursuant to Section 6.20 but
excluding any Liability for any withholding obligations or surtax except as
provided for under Section 6.20;
(b) any Liability for sales, use, value added, transfer,
recordation, intangible, documentary, stamp or similar Taxes or charges
applicable to or resulting from, the transfer of the Purchased Assets to
Purchaser as contemplated by this Agreement;
(c) any Liability to indemnify the officers and directors of the
Company, the Purchased Companies or their Subsidiaries for matters arising prior
to or as of the Effective Time; and
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(d) any Liability under or with respect to any Purchased Asset
(including, without limitation, all Liabilities under Contracts that become
Purchased Assets in accordance with Section 6.3 or Section 6.19) (collectively,
the "Assumed Liabilities").
1.4 Excluded Liabilities Purchaser will not assume or be liable
for any Excluded Liabilities. The Company shall timely perform, satisfy and
discharge in accordance with their respective terms all Excluded Liabilities.
"Excluded Liabilities" shall mean the following Liabilities of the Company:
(a) except to the extent expressly included as an Assumed Liability,
and except for the Surtax Liability and the Withholding Obligations pursuant to
Section 6.20, any Liability arising or resulting from events occurring after the
Effective Time, including without limitation any Liability (including
Liabilities for surtax, withholding tax or other Taxes that do not become
Assumed Liabilities under Section 6.20) arising in connection with the
liquidation of the Company and/or any dividend or other distribution by the
Company to its shareholders; provided, that the foregoing shall not limit the
Purchaser's obligations under Section 6.20;
(b) except as provided in Section 1.3(c), any Liability under or
with respect to any Excluded Assets including, without limitation, all
Liabilities under all Contracts that become Excluded Assets in accordance with
Section 6.3 or Section 6.19); provided, however, that the foregoing shall not
limit Purchaser's obligations under the Indemnity Agreement;
(c) any Liability arising under this Agreement or the Voting
Agreements;
(d) all Liabilities of the Company, the Purchased Companies or any
of their Subsidiaries for fees, expenses and costs of legal, accounting,
financial or other advisors incurred in connection with or arising from this
Agreement, the Transaction or any of the other transactions contemplated hereby;
provided, however, that Liabilities of the Purchased Companies and any of their
Subsidiaries for fees, expenses and costs of legal, accounting, financial or
other advisors arising after the Effective Time shall not be Excluded
Liabilities;
(e) all Liabilities related to amounts payable in connection with
the Transaction and related liquidation of the Company with respect to options,
awards or other rights under the Company Stock Plans and the ESPP (including,
without limitation, any Liability with respect to Taxes required to be paid or
withheld in connection with any grant, exercise or acceleration of any option,
award or other such right); and
(f) all Liabilities related to or arising from the Convertible
Securities and/or the Warrants.
1.5 Purchase Price Allocation. Not later than sixty (60) days
after the Closing Date, the Purchaser shall prepare and deliver to the Company
copies of Form 8594 and any required exhibits thereto (the "Asset Acquisition
Statement") allocating the Purchase Price among the Purchased Assets. The
Purchaser shall prepare and deliver to the Company from time to time revised
copies of the Asset Acquisition Statement (the "Revised Statements") so as to
report any matters on the Asset Acquisition Statement that need updating
(including purchase price adjustments, if any). The Purchase Price paid by the
Purchaser for the Purchased Assets shall be allocated in accordance with the
Asset Acquisition Statement or, if applicable, the last
4
Revised Statements, provided by the Purchaser to the Company, and all income Tax
Returns and reports filed by the Purchaser and the Company shall be prepared
consistently with such allocation.
ARTICLE II
PURCHASE PRICE AND PAYMENT
2.1 Amount of Purchase Price. The purchase price for the Purchased
Assets (the ("Purchase Price") shall be the sum of (a) an amount of cash equal
to Eighty-Four Million Five Hundred Sixty-Seven Thousand One Hundred Fifty-
Eight Dollars ($84,567,158) (the "Initial Cash Payment"), (b) assumption of the
Assumed Liabilities, (c) the payments with respect to certain Taxes described in
Section 6.20, and (d) the Reimbursable Costs pursuant to Section 9.4(b).
2.2 Payment of Purchase Price.
(a) On the Closing Date, the Purchaser shall pay to the Company the
Initial Cash Payment, which shall be paid by the delivery to the Company by wire
transfer of immediately available funds into an account designated by the
Company, and Purchaser shall assume the Assumed Liabilities by executing and
delivering the Assignment and Assumption Agreement described in Section 8.1. The
additional payments in respect of certain Taxes described in Section 6.20 shall
be made at the times provided in such Section.
(b) The Transaction shall be deemed effective with respect to each
Purchased Company and their Subsidiaries as of 12:01 a.m. local time on the
Closing Date in the jurisdiction of such Purchased Company or Subsidiary (the
"Effective Time").
ARTICLE III
CLOSING AND TERMINATION
3.1 Closing Date. Subject to the satisfaction of the conditions
set forth in Section 7.1, Section 7.2 and Section 7.3 hereof (or the waiver
thereof by the party entitled to waive that condition), the closing of the sale
and purchase of the Purchased Assets and the assumption of the Assumed
Liabilities provided for in Section 1.1 and Section 1.3 hereof (the "Closing")
shall take place at 8:00 a.m. at the offices of Weil, Gotshal & ▇▇▇▇▇▇ LLP, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, or at such other location as
the parties hereto agree as promptly as possible upon, and in any event within
five (5) Business Days after, the satisfaction or waiver of the conditions set
forth in Section 7.1, Section 7.2 and Section 7.3 (other than those conditions
that by their nature are to be satisfied at the Closing, but subject to the
satisfaction or waiver of such conditions). The date on which the Closing shall
be held is referred to in this Agreement as the "Closing Date".
3.2 Termination of Agreement. This Agreement may be terminated
prior to the Closing as follows:
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(a) by mutual written consent of the Purchaser and the Company;
(b) by either Purchaser or the Company:
(i) if the Transaction shall not have been consummated on or
before December 15, 2004 (the "Initial Outside Date"); provided, however,
that: (A) if the Transaction shall not have been consummated on or before
such date because the condition set forth in Section 7.1(b) has not been
satisfied or waived, then such date shall be automatically extended to
January 31, 2005 (the "Outside Date") and (B) the right to terminate this
Agreement under this Section 3.2.(b)(i) shall not be available to any
party whose action or failure to act has been a principal cause of or
resulted in the failure of the Transaction to be consummated on or before
such date;
(ii) if any Order having the effect set forth in Section 7.1(c)
shall be in effect and shall have become final and nonappealable; or
(iii) if the Company Shareholder Approval shall not have been
obtained at the Company Shareholders Meeting duly convened therefor or at
any adjournment or postponement thereof;
(c) by Purchaser, if the Company shall have breached or failed to
perform any of its representations, warranties, covenants or agreements set
forth in this Agreement, which breach or failure to perform (A) would give rise
to the failure of a condition set forth in Section 7.2(a) or Section 7.2 (b) and
(B) is incapable of being cured, or is not cured, by the Company within sixty
(60) calendar days following receipt of written notice of such breach or failure
to perform from Purchaser;
(d) by the Company, if Purchaser shall have breached or failed to
perform any of its representations, warranties, covenants or agreements set
forth in this Agreement, which breach or failure to perform (i) would give rise
to the failure of a condition set forth in Section 7.3(a) or Section 7.3(b) and
(ii) is incapable of being cured, or is not cured, by Purchaser within sixty
(60) calendar days following receipt of written notice of such breach or failure
to perform from the Company; or
(e) by Purchaser, in the event that (i) a Company Adverse
Recommendation Change shall have occurred or (ii) the Company Boards or any
committee thereof shall have failed to publicly confirm their recommendation and
declaration of advisability of this Agreement and the Transaction within five
(5) business days after a written request by Purchaser that it do so.
3.3 Procedure Upon Termination. In the event of termination and
abandonment by the Purchaser or the Company or both, pursuant to Section 3.2
hereof, written notice thereof shall forthwith be given to the other party or
parties, and this Agreement shall terminate, and the purchase of the Purchased
Assets hereunder shall be abandoned, without further action by the Purchaser or
the Company.
3.4 Effect of Termination. If this Agreement is terminated as
provided herein, then each of the parties shall be relieved of their duties and
obligations arising under this
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Agreement after the date of such termination and such termination shall be
without liability to the Purchaser or the Company, other than pursuant this
Section 3.4 (Effect of Termination), Section 6.1(b) (Confidentiality), Section
9.4 (Expenses), and Article IX (Miscellaneous), which provisions shall each
survive such termination, provided, however, that nothing in this Section 3.4
shall relieve (i) the Purchaser of any liability for a willful, knowing or
intentional breach of this Agreement or (ii) the Company of any liability for a
willful, Knowing or intentional breach of this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as disclosed in a document of even date herewith and
delivered by the Company to Purchaser prior to the execution and delivery of
this Agreement and referring by numbered section (and, where applicable, by
lettered subsection) of the representations and warranties in this Agreement
(the "Company Disclosure Schedule") (it being understood that any matter
disclosed in any section of the Company Disclosure Schedule shall be considered
disclosed for other sections of the Company Disclosure Schedule, but only to the
extent such matter on its face would reasonably be expected to be pertinent to
other sections of the Company Disclosure Schedule in light of the disclosure
made), the Company represents and warrants to Purchaser as follows:
4.1 Organization and Good Standing.
Each of the Company, the Purchased Companies and their Subsidiaries
is a corporation or other entity duly organized, validly existing and in good
standing (or its equivalent, if any) under the Laws of the jurisdiction of its
incorporation as set forth on Annex A hereto, and has all requisite corporate or
other applicable organizational power and authority to own, lease and operate
its properties and to carry on its business as now conducted. Each of the
Company, the Purchased Companies and their Subsidiaries is duly qualified or
authorized to do business as a foreign corporation (or other applicable entity)
and is in good standing under the Laws of each jurisdiction in which it owns or
leases real property and each other jurisdiction in which the conduct of its
respective business or the ownership of its respective properties requires such
qualification or authorization.
4.2 Authorization of Agreement. The Company has all requisite
power and authority to execute and deliver this Agreement, the Assignment and
Assumption Agreement, the Indemnity Agreement and each other agreement,
document, or instrument or certificate contemplated by this Agreement or to be
executed by the Company in connection with the consummation of the transactions
contemplated by this Agreement, and to consummate the transactions contemplated
hereby (assuming the Company Shareholder Approval is obtained). The execution,
delivery and performance by the Company of this Agreement, the Assignment and
Assumption Agreement and the Indemnity Agreement have been duly authorized by
all necessary corporate action on behalf of the Company (assuming the Company
Shareholder Approval is obtained). This Agreement has been, and at or prior to
the Closing, the Assignment and Assumption Agreement and the Indemnity Agreement
will be, duly executed and delivered
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by the Company and (assuming the due authorization, execution and delivery by
the other parties hereto and thereto) this Agreement constitutes, and the
Assignment and Assumption Agreement and the Indemnity Agreement (when so
executed and delivered) will constitute legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally, and
subject, as to enforceability, to general principles of equity, including
principles of commercial reasonableness, good faith and fair dealing (regardless
of whether enforcement is sought in a proceeding at law or in equity).
4.3 Capitalization.
(a) The authorized capital stock of the Company consists of forty
million (40,000,000) common shares, par value 0.44 Euro per share ("Company
Common Stock"), and ten million (10,000,000) preferred shares, par value 0.44
Euro per share (rounded off as permitted by Section 2:67c of the Dutch Civil
Code) ("Company Preferred Stock"). At the close of business on August 13, 2004,
(i) 14,226,897 shares of Company Common Stock were issued and outstanding (of
which 1,394,901 shares of Company Common Stock were held by the Company in its
treasury), (ii) four million seven hundred fifty thousand (4,750,000) shares of
Company Common Stock were reserved for issuance under the Company's Amended and
Restated Employee Stock Option Plan (the "Employee Option Plan"), 794,868 of
which have been issued pursuant to the exercise of options granted under the
Employee Option Plan, 3,272,267 of which are subject to outstanding options
granted under the Employee Option Plan and 682,865 of which remain available for
issuance under the Employee Option Plan, (iii) two hundred twenty-five thousand
(225,000) shares of Company Common Stock were reserved for issuance under the
Company's 1997 Supervisory Directors Stock Option Plan (the "Director Option
Plan"), none of which have been issued pursuant to the exercise of options
granted under the Director Option Plan, 173,750 of which are subject to
outstanding options granted under the Director Option Plan and 51,250 of which
remain available for issuance under the Director Option Plan, (iv) five hundred
thousand (500,000) shares of Company Common Stock were reserved for issuance
under the Company's Supplemental Stock Option Plan (the "Supplemental Option
Plan," together with the Employee Option Plan and the Director Option Plan,
collectively the "Company Stock Plans"), 250 of which have been issued pursuant
to the exercise of options granted under the Supplemental Option Plan, 426,560
of which are subject to outstanding options granted under the Supplemental
Option Plan and 73,190 of which remain available for issuance under the
Supplemental Option Plan, (v) two hundred thousand (200,000) shares of Company
Common Stock were reserved for issuance under the Company's Employee Stock
Purchase Plan (the "ESPP"), 45,049 of which have been issued pursuant to the
ESPP, (vi) no shares of Company Preferred Stock were issued or outstanding,
(vii) warrants to purchase an aggregate of 1,633,770 shares of Company Common
Stock were outstanding ("Warrants"), and 1,633,770 shares of Company Common
Stock were reserved for issuance upon exercise of the Warrants (correct and
complete copies of which have been delivered to Purchaser) and (viii) 3,611,106
shares of Company Common Stock were reserved for issuance upon conversion of the
Company's convertible debentures (correct and complete copies of which have been
delivered to Purchaser) ("Convertible Securities"). All shares of Company Common
Stock have been duly authorized and validly issued and are fully paid,
nonassessable and free of preemptive rights. Included in Section 4.3(a) of the
Company Disclosure Schedule is a correct and complete list, as
8
of August 13, 2004, of all outstanding options or other rights to purchase or
receive shares of Company Common Stock granted under the Company Stock Plans or
otherwise (other than under the Warrants, Convertible Securities or the ESPP),
and, for each such option or other right, the number of shares of Company Common
Stock subject thereto, the terms of vesting, the grant and expiration dates and
exercise price thereof and the name of the holder thereof. The current "Purchase
Period" (as defined in the ESPP) commenced under the ESPP on June 1, 2004 and
will (but for the transactions contemplated by this Agreement) end on December
1, 2004, and except for the purchase rights granted on such commencement date to
the participants in the current Purchase Period, there are no other purchase
rights outstanding under the ESPP as of the date of this Agreement. Since May
31, 2004, the Company has not issued any shares of its capital stock, voting
securities or equity interests, or any securities convertible into or
exchangeable or exercisable for any shares of its capital stock, voting
securities or equity interests, other than (i) pursuant to the outstanding
options, Warrants and Convertible Securities, in each case, referred to above in
this Section 4.3(a) and (ii) as expressly permitted by Section 6.2 hereof.
Except (i) as set forth above in this Section 4.3(a) or (ii) as otherwise
expressly permitted by Section 6.2 hereof, as of the date of this Agreement
there are not, and as of the Effective Time there will not be, any shares of
capital stock, voting securities or equity interests of the Company issued and
outstanding or any subscriptions, options, warrants, calls, convertible or
exchangeable securities, rights, commitments or agreements of any character
providing for the issuance of any shares of capital stock, voting securities or
equity interests of the Company, including any representing the right to
purchase or otherwise receive any Company Common Stock or Company Preferred
Stock.
(b) Except for this Agreement, none of the Company, any of the
Purchased Companies or any of their Subsidiaries has issued or is bound by any
outstanding subscriptions, options, warrants, calls, convertible or exchangeable
securities, rights, commitments or agreements of any character providing for the
issuance or disposition of any shares of capital stock, cash based on the value
of capital stock, voting securities or equity interests of any Purchased Company
or any of their Subsidiaries. There are no outstanding obligations of the
Company, the Purchased Companies or any of their Subsidiaries to repurchase,
redeem or otherwise acquire any shares of capital stock, voting securities or
equity interests (or any options, warrants or other rights to acquire any shares
of capital stock, voting securities or equity interests) of the Company, the
Purchased Companies or any of their Subsidiaries.
4.4 Purchased Companies and their Subsidiaries. Section 4.4 of the
Company Disclosure Schedule sets forth the name of each Purchased Company and
each of its Subsidiaries, and, with respect to each Purchased Company and each
of its Subsidiaries, the jurisdiction in which it is incorporated or organized,
the jurisdictions, if any, in which it is qualified to do business, the number
of shares of its authorized capital stock, the number and class of shares
thereof duly issued and outstanding, the names of all shareholders or other
equity owners and the number of shares of stock owned by each shareholder or the
amount of equity owned by each equity owner. The outstanding shares of capital
stock or equity interests of each Subsidiary are validly issued, fully paid and
non-assessable, and all such shares or other equity interests represented as
being owned by Company are owned by it free and clear of any and all Liens. No
shares of capital stock are held by any Purchased Company or any of their
Subsidiaries as treasury stock. There is no existing option, warrant, call,
commitment or agreement to which any Purchased Company or Subsidiary is a party
requiring, and there are no
9
convertible securities of any Purchased Company or any of their Subsidiaries
outstanding which upon conversion would require, the issuance of any additional
shares of capital stock or other equity interests of any Purchased Company or
any of their Subsidiaries or other securities convertible into shares of capital
stock or other equity interests of any Purchased Company or any of their
Subsidiaries or other equity security of any Purchased Company or any of their
Subsidiaries.
4.5 Corporate Records.
(a) The Company has delivered or made available to the Purchaser
true, correct and complete copies of the articles of association and by-laws or
comparable organizational documents of the Company, the Purchased Companies and
each of their Subsidiaries.
(b) The minute books of the Company, the Purchased Companies and
each of their Subsidiaries previously made available to the Purchaser contain
complete and accurate records of all meetings and accurately reflect all other
corporate action of the shareholders and Company Boards (including committees
thereof) of the Company or the equivalent governing body of each of the
Purchased Companies and each of their Subsidiaries. All stock transfer taxes
levied or payable with respect to all transfers of shares of the Company, the
Purchased Companies and their Subsidiaries prior to the date hereof have been
paid and appropriate transfer tax stamps affixed.
4.6 Conflicts; Consents of Third Parties.
(a) None of the execution and delivery by the Company of this
Agreement, the Assignment and Assumption Agreement, the Indemnity Agreement and
the consummation of the transactions contemplated hereby and thereby, or
compliance by the Company with any of the provisions hereof or thereof will
conflict with, or result in any violation of or default by the Company, the
Purchased Companies or any of their Subsidiaries (with or without notice or
lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of any material
benefit under, or give rise to any obligation of the Company to make any payment
under, or to the increased, additional, accelerated or guaranteed rights or
entitlements of any Person under, or result in the creation of any Liens upon
any of the properties or assets of the Company, the Purchased Companies or any
of their Subsidiaries under any provision of (i) the articles of association and
comparable organizational documents of the Company, the Purchased Companies or
any of their Subsidiaries (assuming the Company Shareholder Approval is
obtained); (ii) any Material Contract, or material Permit to which the Company,
any of the Purchased Companies or any of their Subsidiaries is a party or by
which any of the properties or assets of the Company, the Purchased Companies or
any of their Subsidiaries are bound; (iii) any Order of any court, Governmental
Body or arbitrator applicable to the Company, the Purchased Companies or any of
their Subsidiaries; or any of the properties or assets of the Company, the
Purchased Companies or any of their Subsidiaries as of the date hereof; and (iv)
any applicable Law (other than Antitrust Laws).
(b) No consent, waiver, approval, Order, Permit or authorization
of, or declaration or filing with, or notification to, any Person or
Governmental Body is required on the
10
part of the Company, the Purchased Companies or any of their Subsidiaries in
connection with the execution and delivery of this Agreement, the Assignment and
Assumption Agreement, the Indemnity Agreement or the compliance by the Company,
the Purchased Companies or any of their Subsidiaries with any of the provisions
hereof or thereof, the consummation of the transactions contemplated hereby or
thereby or the taking of any other action contemplated hereby or thereby, or the
continuing validity and effectiveness immediately following the Closing of any
material Permit or material Contract of the Company, the Purchased Companies or
any of their Subsidiaries, except for (i) compliance with the applicable
requirements of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976 and the
rules and regulations promulgated thereunder (the "HSR Act"); (ii) the filing
with the United States Securities and Exchange Commission (the "SEC") of (A) a
proxy statement relating to the Company Shareholders Meeting (as amended or
supplemented from time to time, the "Company Proxy Statement") and (B) such
reports under Section 13(a), 13(d), 15(d) or 16(a) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), as may be required in connection
with this Agreement and the transactions contemplated by this Agreement; (iii)
filings with and approvals of the Nasdaq National Market; and (iv) filings under
Antitrust Laws.
4.7 Ownership and Transfer of Shares. The Company or a Purchased
Company, as shown in Annex A, is the record and beneficial owner of the Shares
free and clear of any and all Liens. The Company has the corporate power and
authority to sell, transfer, assign and deliver the Shares held by the Company
as provided in this Agreement (assuming the Company Shareholder Approval is
obtained), and such delivery will convey to the Purchaser good and marketable
title to such Shares, free and clear of any and all Liens. A Purchased Company
is the record and beneficial owner of all of the outstanding shares of capital
stock of the Subsidiaries of the Purchased Companies as set forth on Annex A-1
(other than those shares of capital stock set forth on Annex A-1 as not being
held by a Purchased Company, (such shares of capital stock not held by a
Purchased Company, but excluding the capital stock of Metron Technology Holding
Limited and Metron Technology (Thailand) Limited being referred to as "Third
Party Shares")), free and clear of any and all Liens. Each party shown on Annex
A-1 as the owner of any Third Party Shares has the requisite power and authority
to sell, transfer, assign and deliver such Third Party Shares as provided in
this Agreement, and such delivery will convey to the Purchaser good and
marketable title to such Third Party Shares, free and clear of any and all
Liens. Metron Technology (Europa) is the record and beneficial of the number of
outstanding shares of Metron ▇▇▇▇▇▇ Partnership set forth on Annex A-2, free and
clear of any and all Liens.
4.8 SEC Documents; No Undisclosed Liabilities.
(a) The Company has filed all required reports, schedules, forms,
prospectuses, and registration, proxy and other statements with the SEC since
June 1, 2001 (collectively, and in each case including all exhibits and
schedules thereto and documents incorporated by reference therein, the "Company
SEC Documents"). None of the Purchased Companies or any of their Subsidiaries is
required to file periodic reports with the SEC pursuant to the Exchange Act. As
of their respective effective dates (in the case of Company SEC Documents that
are registration statements filed pursuant to the requirements of the Securities
Act of 1933, as amended (the "Securities Act")) and as of their respective SEC
filing dates (in the case of all other Company SEC Documents), the Company SEC
Documents complied in all
11
material respects with the requirements of the Exchange Act and the Securities
Act, as the case may be, and the rules and regulations of the SEC promulgated
thereunder, applicable to such Company SEC Documents, and none of the Company
SEC Documents as of such respective dates, nor any other communication
disseminated by the Company to its securityholders since June 1, 2001 as of its
respective dissemination date, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading. The Company has timely filed all required
filings and forms with the Netherlands Authority for the Financial Markets
(Stichting Autoriteit Financiele Markten) and the Company is in compliance in
all material respects with the applicable provisions of the 1995 Act on the
Supervision of the Securities Trade (Wet toezicht effectenverkeer).
(b) The consolidated financial statements of the Company included
in the Company SEC Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto as of their respective effective dates (in the case
of Company SEC Documents that are registration statements filed pursuant to the
requirements of the Securities Act) and as of their respective SEC filing dates
(in the case of all other Company SEC Documents), have been prepared in all
material respects in accordance with GAAP (except, in the case of unaudited
quarterly statements, as indicated in the notes thereto) applied on a consistent
basis during the periods involved (except as may be indicated in the notes
thereto) and fairly present in all material respects the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates
thereof and the consolidated results of their operations and cash flows for the
periods then ended (subject, in the case of unaudited quarterly statements, to
normal year-end audit adjustments, none of which has been or will be,
individually or in the aggregate, material to the Company and its Subsidiaries
taken as a whole). Without limiting the generality of the foregoing, with
respect to each Annual Report on Form 10-K and each Quarterly Report on Form
10-Q included in the Company SEC Documents, the financial statements and other
financial information included in such reports fairly present (within the
meaning of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002) in all material respects the
financial condition and results of operations of the Company as of, and for, the
periods presented in such Company SEC Documents.
(c) The Company has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15 and Rule 15d-15 under the
Exchange Act); such disclosure controls and procedures are designed to ensure
that material information relating to the Company, including its consolidated
Subsidiaries, required to be disclosed by the Company in the reports that it
files under the Exchange Act is accumulated and communicated to the Company's
principal executive officer and its principal financial officer to allow timely
decisions regarding disclosure; and such disclosure controls and procedures are
effective to ensure information required to be disclosed in the Company's
reports that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the SEC rules and
forms. The Company's principal executive officer and its principal financial
officer have disclosed, based on their most recent evaluation, to the Company's
auditors and the audit committee of the Supervisory Board (x) all significant
deficiencies in the design or operation of internal controls over financial
reporting which are reasonably likely to adversely affect the Company's ability
to record, process, summarize and
12
report financial data and have identified for the Company's auditors any
material weaknesses in internal controls over financial reporting and (y) any
fraud, whether or not material, that involves management or other employees who
have a significant role in the Company's internal controls over financial
reporting. Neither the Company, any of the Purchased Companies nor any of their
Subsidiaries nor any of their respective directors, officers, employees,
auditors or accountants has received or otherwise had or obtained knowledge of
any material complaint, allegation, assertion or claim, whether written or oral,
regarding the accounting or auditing practices, procedures, methodologies or
methods of the Company or any of its Subsidiaries or their respective internal
accounting controls, including any material complaint, allegation, assertion or
claim that the Company, any of the Purchased Companies or any of its
Subsidiaries has engaged in questionable accounting or auditing practices. No
attorney representing the Company, any of the Purchased Companies or any of
their Subsidiaries, whether or not employed by the Company, any of the Purchased
Companies or any of their Subsidiaries, has reported evidence of a material
violation of securities Laws, breach of fiduciary duty or similar violation by
the Company, any of the Purchased Companies or any of their Subsidiaries or any
of its officers, directors, employees or agents to the Company Boards or any
committee thereof. With respect to each Annual Report on Form 10-K, each
Quarterly Report on Form 10-Q and each amendment of any such report included in
the Company SEC Documents filed since the enactment of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002, the principal executive officer and the principal financial officer of
Company have made all certifications required by the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002
and any related rules and regulations promulgated by the SEC, and the statements
contained in such certifications were complete and correct when made.
(d) The Company is in compliance in all material respects with the
provisions of Section 13(b) of the Exchange Act. None of the Company, the
Purchased Companies or any of their Subsidiaries or, to the Company's knowledge,
any director, officer, agent, employee or other Person acting on behalf of the
Company or any of its Subsidiaries, has, in any material respect, (i) used any
corporate or other funds for unlawful contributions, payments, gifts, or
entertainment, or made any unlawful expenditures relating to political activity
to government officials or others or established or maintained any unlawful or
unrecorded funds in violation of Section 30A of the Exchange Act or (ii)
accepted or received any unlawful contributions, payments, gifts or
expenditures. Except as set forth in the Company SEC Documents or for events (or
series of related matters) as to which the amounts involved do not exceed
$60,000, since the Company's proxy statement dated September 29, 2003, no event
has occurred that would be required to be reported as a "Certain Relationship or
Related Transaction" pursuant to Item 404 of Regulation S-K promulgated by the
SEC.
(e) Neither the Company nor any of its Subsidiaries has any
Liabilities or obligations of any nature (whether accrued, absolute, contingent
or otherwise) whether or not required, if known, to be reflected or reserved
against on a consolidated balance sheet of the Company prepared in accordance
with GAAP or the notes thereto, except Liabilities (i) as and to the extent set
forth on the unaudited balance sheet of the Company and its Subsidiaries as of
May 31, 2004 (the "Balance Sheet Date") furnished with the Company's Form 8-K
filed with the SEC on July 8, 2004 (the "Balance Sheet") (ii) incurred after the
Balance Sheet Date in the Ordinary Course of Business that, individually or in
the aggregate, are not material or (iii) arising under this Agreement.
13
4.9 Information Supplied. None of the information included or
incorporated by reference in the Company Proxy Statement will, at the date it is
first mailed to the shareholders of the Company and at the time of the Company
Shareholders Meeting, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they are
made, not misleading, except that no representation or warranty is made by the
Company with respect to statements made or incorporated by reference therein
based on information supplied by Purchaser specifically for inclusion or
incorporation by reference in the Company Proxy Statement. The Company Proxy
Statement will comply as to form in all material respects with the requirements
of the Exchange Act and the rules and regulations thereunder.
4.10 Absence of Certain Developments. Since the Balance Sheet Date
and except as expressly permitted by Section 6.2 (i) the Company, the Purchased
Companies and their Subsidiaries have each conducted their business in all
material respects only in the Ordinary Course of Business and (ii) there has not
been any event, change, occurrence or circumstance that has had or would
reasonably be expected to have a Material Adverse Effect. Without limiting the
generality of the foregoing, since the Balance Sheet Date and except as
permitted by or in compliance with Section 6.2:
(i) there has not been any damage, destruction or loss, whether or
not covered by insurance, with respect to the property and assets of the
Company, the Purchased Companies or any of their Subsidiaries having a
replacement cost of more than $25,000 for any single loss or $100,000 for
all such losses;
(ii) there has not been any declaration, setting aside or payment
of any dividend or other distribution in respect of any shares of capital
stock of the Company, the Purchased Companies or any of their Subsidiaries
or any repurchase, redemption or other acquisition by the Company, the
Purchased Companies or any of their Subsidiaries of any outstanding shares
of capital stock or other securities of, or other ownership interest in,
the Company, the Purchased Companies or any of their Subsidiaries;
(iii) none of the Company, the Purchased Companies or any of their
Subsidiaries have awarded or paid any bonuses to employees of the Company,
any of the Purchased Companies or any of their Subsidiaries or entered
into any employment (other than to the extent providing for "at-will"
employment and without severance), deferred compensation, severance or
similar agreement (nor amended any such agreement) or increased or agreed
to increase the compensation payable (including equity compensation,
whether payable in cash, stock or other property) or to become payable by
it to any of the Company's, the Purchased Companies' or their
Subsidiaries' respective directors, officers, employees, agents or
representatives or increased or agreed to increase the coverage or
benefits available under any severance pay, termination pay, vacation pay,
company awards, salary continuation for disability, sick leave, deferred
compensation, bonus or other incentive compensation, insurance, pension or
other employee benefit plan, payment or arrangement made to, for or with
such directors, officers, employees, agents or representatives;
14
(iv) there has not been any change by the Company, the Purchased
Companies or any of their Subsidiaries in accounting or Tax reporting
principles, methods or policies;
(v) none of the Company, the Purchased Companies or any of their
Subsidiaries have made or rescinded any election relating to Taxes, or
settled or compromised any claim, action, suit, litigation, proceeding,
arbitration, investigation, audit or controversy relating to Taxes;
(vi) none of the Company, the Purchased Companies or any of their
Subsidiaries have entered into any transaction or Contract other than in
the Ordinary Course of Business or conducted its business other than in
the Ordinary Course of Business;
(vii) none of the Company, the Purchased Companies or any of their
Subsidiaries have failed to promptly pay and discharge current liabilities
when due in the Ordinary Course of Business except where disputed in good
faith by appropriate proceedings;
(viii) none of the Company, the Purchased Companies or any of their
Subsidiaries have made any loans, advances or capital contributions to, or
investments in, any Persons other than advances for reasonable business
expenses to employees made in the Ordinary Course of Business and listed,
in the case of loans to any officer or director of the Company, by
individual in Section 4.10(viii) of the Company Disclosure Schedule;
(ix) none of the Company, the Purchased Companies or any of their
Subsidiaries have mortgaged, pledged or subjected to any Lien (other than
Permitted Exceptions) any of its assets, or acquired any assets or sold,
assigned, transferred, conveyed, leased or otherwise disposed of any
assets of the Company, the Purchased Companies or any of their
Subsidiaries, except for assets acquired or sold, assigned, transferred,
conveyed, leased or otherwise disposed of in the Ordinary Course of
Business;
(x) none of the Company, the Purchased Companies or any of their
Subsidiaries have discharged or satisfied any Lien (other than Permitted
Exceptions), or paid any obligation or liability (fixed or contingent),
except in the Ordinary Course of Business and which, in the aggregate,
would not be material to the Company, the Purchased Companies and their
Subsidiaries taken as a whole;
(xi) none of the Company, the Purchased Companies or any of their
Subsidiaries have canceled or compromised any debt or claim or amended,
canceled, terminated, relinquished, waived or released any Material
Contract or material right except in the Ordinary Course of Business and
which, in the aggregate, would not be material to the Company, the
Purchased Companies and their Subsidiaries taken as a whole;
15
(xii) none of the Company, the Purchased Companies or any of their
Subsidiaries have made or committed to make any capital expenditures or
capital additions or betterments in excess of $25,000 individually or
$250,000 per quarter;
(xiii) none of the Company, the Purchased Companies or any of their
Subsidiaries have issued, created, incurred, assumed or guaranteed any
Indebtedness in an amount in excess of $50,000 in the aggregate;
(xiv) the Company, the Purchased Companies or any of their
Subsidiaries, have not granted any license or sublicense of any rights
under or with respect to any Company Intellectual Property or Company
Technology, except for grants of non-exclusive rights made in connection
with sales of products;
(xv) none of the Company, the Purchased Companies or any of their
Subsidiaries have instituted or settled any material Legal Proceeding; and
(xvi) none of the Company, the Purchased Companies or any of their
Subsidiaries have agreed to do anything set forth in this Section 4.10.
4.11 Taxes.
(a) (i) All Tax Returns required to be filed by or on behalf of
and including the Company, the Purchased Companies and their Subsidiaries have
been properly prepared and duly and timely filed with the appropriate taxing
authorities in all jurisdictions in which such Tax Returns are required to be
filed (after giving effect to any valid extensions of time in which to make such
filings), and all such Tax Returns were true, correct and complete in all
material respects; (ii) all Taxes due and payable by or on behalf of the
Company, the Purchased Companies and their Subsidiaries have been timely paid in
full; (iii) full reserves or accruals have been provided in the books of the
Company and its Subsidiaries for all actual and contingent liabilities for Taxes
(whether or not reflected on any Tax Returns) with respect to all periods
through the end of the last monthly period for which the Company and its
Subsidiaries ordinarily record items on their respective books; and (iv) none of
the Company, the Purchased Companies or any of their Subsidiaries has executed
or filed with any taxing authority any agreement, waiver or other document or
arrangement extending or having the effect of extending the period for
assessment or collection of Taxes (including, but not limited to, any applicable
statute of limitations), and no power of attorney with respect to any Tax matter
is currently in force.
(b) Each of the Company, the Purchased Companies and their
Subsidiaries has complied with all applicable Laws, rules and regulations
relating to the payment and withholding of Taxes and has duly and timely
withheld from employee salaries, wages and other compensation and has paid over
to the appropriate taxing authorities all amounts required to be so withheld and
paid over for all periods under all applicable Laws.
(c) The Company has made available to the Purchaser complete
copies of (i) all federal, state, local and foreign Tax Returns of the Company,
the Purchased Companies and their Subsidiaries relating to the taxable periods
since January 1, 2001 and (ii) any audit report issued within the last three (3)
years relating to Taxes due from or with respect to the Company,
16
the Purchased Companies or any of their Subsidiaries, and their income, assets
or operations. All income and franchise Tax Returns filed by or on behalf of the
Company, the Purchased Companies or any of their Subsidiaries for the taxable
years ended on the respective dates set forth on Section 4.11 of the Company
Disclosure Schedule have been examined by the relevant taxing authority or the
statute of limitations with respect to such Tax Returns has expired.
(d) Section 4.11 of the Company Disclosure Schedule lists (i) the
income and franchise Taxes paid and income and franchise Tax Returns filed by or
on behalf of or including the Company, the Purchased Companies and their
Subsidiaries and (ii) all of the jurisdictions in which the Company, the
Purchased Companies and their Subsidiaries have an obligation to pay income or
franchise Taxes or file income or franchise Tax Returns. No claim has been made
by a taxing authority in a jurisdiction where the Company, any of the Purchased
Companies or any of their Subsidiaries does not file an income or franchise Tax
Return that such entity is or may be subject to income or franchise taxation by
that jurisdiction.
(e) All deficiencies asserted or assessments made as a result of
any examinations by any taxing authority of the Tax Returns of or covering or
including the Company, the Purchased Companies or any of their Subsidiaries have
been fully and timely paid, and there are no other audits or investigations by
any taxing authority in progress, nor has the Company, any of the Purchased
Companies or any of their Subsidiaries received any notice from any taxing
authority that it intends to conduct such an audit or investigation. No issue
has been raised by a federal, state, local or foreign taxing authority in any
current or prior examination which, by application of the same or similar
principles, would reasonably be expected to result in a proposed deficiency for
any subsequent taxable period.
(f) None of the Company, the Purchased Companies or any of their
Subsidiaries has (i) agreed to or is required to make any adjustments pursuant
to Section 481(a) of the Code or any similar provision of state, local or
foreign Law by reason of a change in accounting method initiated by the Company,
the Purchased Companies or any of their Subsidiaries or has received any written
notice that a taxing authority has proposed any such adjustment or change in
accounting method, or has any application pending with any taxing authority
requesting permission for any changes in accounting methods that relate to the
business or operations of the Company, the Purchased Companies or any of their
Subsidiaries, (ii) executed or entered into a closing agreement pursuant to
Section 7121 of the Code or any predecessor provision thereof or any similar
provision of state, local or foreign Law with respect to the Company, the
Purchased Companies or any of their Subsidiaries, or (iii) requested any
extension of time within which to file any Tax Return, which Tax Return has
since not been filed by the extended due date.
(g) None of the property owned by the Company, the Purchased
Companies or any of their Subsidiaries is (i) property required to be treated as
being owned by another Person pursuant to the provisions of Section 168(f)(8) of
the Internal Revenue Code of 1954, as amended and in effect immediately prior to
the enactment of the Tax Reform Act of 1986, (ii) "tax-exempt use property"
within the meaning of Section 168(h)(1) of the Code, (iii) is "tax-exempt bond
financed property" within the meaning of Section 168(g) of the Code, (iv)
subject to Section 168(g)(1)(A) of the Code, (v) "limited use property" (as that
term is used in Rev. Proc.
17
2001-28), or (vi) subject to the same or reciprocal treatment under state Law as
property described in clauses (i) through (v).
(h) None of the Company, the Purchased Companies or any of their
Subsidiaries is a party to any tax sharing or similar agreement or arrangement
(whether or not written) pursuant to which it will have any obligation to make
any payments after the Closing.
(i) There is no contract, agreement, plan or arrangement covering
any person that, individually or collectively, would constitute compensation in
excess of the limitation set forth in Section 162(m) of the Code.
(j) None of the Company, the Purchased Companies or any of their
Subsidiaries is subject to any private letter ruling of the IRS or comparable
rulings of other taxing authorities.
(k) There are no liens as a result of any unpaid Taxes upon any of
the assets of the Company, the Purchased Companies or any of their Subsidiaries.
(l) None of the Company, the Purchased Companies or any of their
Subsidiaries has any elections in effect for United States federal income tax
purposes under Sections 108, 168, 338, 441, 463, 472, 1017, 1033 or 4977 of the
Code.
(m) None of the Purchased Companies or any of their Subsidiaries
is or has been a United States real property holding corporation within the
meaning of Section 897 of the Code.
(n) None of the Purchased Companies or any of their Subsidiaries
has constituted either a "distributing corporation" or a "controlled
corporation" (within the meaning of Section 355 of the Code) in a distribution
of stock qualifying for tax-free treatment under Section 355 of the Code (i) in
the two (2) years prior to the date of this Agreement or (ii) which could
constitute part of a "plan" or "series of related transactions" (within the
meaning of Section 355(e) of the Code) in conjunction with the transactions
contemplated by this Agreement.
(o) None of the Purchased Companies or any of their Subsidiaries
has been a member of an affiliated group within the meaning of Section 1504 of
the Code and any comparable or analogous group under state, local or foreign Tax
Law (other than a group of which the Company is the common parent), or has any
liability for the Taxes of any Person under Treasury Regulation Section 1.1502-6
(or any comparable provision of state, local or foreign Tax Law) (other than as
a member of an affiliated group of which the Company is the common parent).
(p) None of the Purchased Companies or any of their Subsidiaries
has in effect an entity classification election pursuant to Treasury Regulation
Sections 301.7701(a)-3.
(q) None of the Purchased Companies or any of their Subsidiaries
has in effect an election described in Section 897(i) of the Code.
18
(r) None of the non-United States Purchased Companies or any of
their non-United States Subsidiaries has filed any United States Tax Returns;
(s) None of the non-United States Purchased Companies or any of
their non-United States Subsidiaries has filed any Tax elections for United
States Tax purposes;
4.12 Real Property.
(a) Section 4.12(a) of the Company Disclosure Schedule sets forth
a complete list of (i) all real property and interests in real property owned in
fee by the Company, the Purchased Companies or any of their Subsidiaries
(individually, an "Owned Property" and collectively, the "Owned Properties"), in
each case identifying the legal name of the entity under which such Owned
Property is held, and (ii) all real property and interests in real property
leased by the Company, the Purchased Companies or any of their Subsidiaries
(individually, a "Real Property Lease" and the real properties specified in such
leases, together with the Owned Properties, being referred to herein
individually as a "Company Property" and collectively as the "Company
Properties") as lessee or lessor, in each case identifying the legal name of the
entity under which such Real Property Lease is held. The Company, the Purchased
Companies and their Subsidiaries have good and marketable fee title to all Owned
Property, free and clear of all Liens of any nature whatsoever except (A) Liens
set forth on Section 4.12(a) of the Company Disclosure Schedule and (B)
Permitted Exceptions. The Company Property constitutes all interests in real
property currently used or currently held for use in connection with the
business of the Company, the Purchased Companies and their Subsidiaries and
which are necessary for the continued operation of the business of the Company,
the Purchased Companies and their Subsidiaries as the business is currently
conducted. The Company, the Purchased Companies and their Subsidiaries have a
valid and enforceable leasehold interest under each of the Real Property Leases,
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and subject, as
to enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity), and none of the
Company, the Purchased Companies or any of their Subsidiaries has received any
written notice of any default or event that with notice or lapse of time, or
both, would constitute a default by the Company, the Purchased Companies or any
of their Subsidiaries under any of the Real Property Leases and, to the
Knowledge of the Company, no other party is in default thereof, and no party to
any of the Real Property Leases has exercised any termination rights with
respect thereto. All of the Company Property, buildings, fixtures and
improvements thereon owned or leased by the Company, the Purchased Companies and
their Subsidiaries are in good operating condition and repair (subject to normal
wear and tear). The Company, the Purchased Companies and their Subsidiaries have
delivered or otherwise made available to the Purchaser true, correct and
complete copies of (i) all deeds, title reports and surveys for the Owned
Properties and (ii) the Real Property Leases, together with all amendments,
modifications or supplements, if any, thereto.
(b) The Company, the Purchased Companies and their Subsidiaries
have all material certificates of occupancy and Permits of any Governmental Body
necessary for the current use and operation of each Company Property, and the
Company, the Purchased Companies and their Subsidiaries have fully complied with
all material conditions of the Permits applicable to them. No default or
material violation, or event that with the lapse of time or
19
giving of notice or both would become a default or material violation, has
occurred in the due observance of any Permit.
(c) There does not exist any actual or, to the Knowledge of the
Company, threatened or contemplated condemnation or eminent domain proceedings
that affect any Company Property or any part thereof, and none of the Company,
the Purchased Companies or any their Subsidiaries has received any notice, oral
or written, of the intention of any Governmental Body or other Person to take or
use all or any part thereof.
(d) None of the Company, the Purchased Companies or any of their
Subsidiaries has received any written notice from any insurance company that has
issued a policy with respect to any Company Property requiring performance of
any structural or other repairs or alterations to such Company Property.
(e) Except as provided in the Real Property Leases, none of the
Company, the Purchased Companies or any of their Subsidiaries owns or holds, and
is not obligated under or a party to, any option, right of first refusal or
other right to purchase, acquire, sell, assign or dispose of any real estate or
any portion thereof or interest therein.
4.13 Tangible Personal Property.
(a) Section 4.13(a) of the Company Disclosure Schedule sets forth
each lease of personal property ("Personal Property Leases") involving annual
payments in excess of $50,000 relating to personal property used in the business
of the Company, the Purchased Companies and their Subsidiaries or to which any
of the Company, any of the Purchased Companies or any of their Subsidiaries is a
party or by which the properties or assets of the Company, the Purchased
Companies or any of their Subsidiaries is bound other than those leases of
personal property made after the date hereof as permitted by or in compliance
with Section 6.2. The Company, the Purchased Companies and their Subsidiaries
have delivered or otherwise made available to the Purchaser true, correct and
complete copies of the Personal Property Leases, together with all amendments,
modifications or supplements, if any, thereto.
(b) Each of the Company, the Purchased Companies and their
Subsidiaries has a valid leasehold interest under each of the Personal Property
Leases under which it is a lessee, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding at law or in
equity), and there is no default under any Personal Property Lease by the
Company, the Purchased Companies or any of their Subsidiaries or, to the
Knowledge of the Company, by any other party thereto, and no event has occurred
that with the lapse of time or the giving of notice or both would constitute a
default thereunder.
(c) The Company, the Purchased Companies and their Subsidiaries
have good and marketable title to all of the items of tangible personal property
reflected in the Balance Sheet (except as sold or disposed of subsequent to the
Balance Sheet Date in the Ordinary Course of Business) or acquired after the
Balance Sheet Date, free and clear of any and all Liens other than the Permitted
Exceptions. All such items of tangible personal property which,
20
individually or in the aggregate, are material to the operation of the business
of the Company, the Purchased Companies and their Subsidiaries are in good
condition and in a state of good maintenance and repair (ordinary wear and tear
excepted) and are suitable for the purposes used.
4.14 Intellectual Property
(a) When used in this Section 4.14 and in throughout this
Agreement, the following capitalized terms shall have the following meanings:
(i) "Company Intellectual Property" means all Intellectual
Property used in or necessary for the conduct of the business of the
Company, the Purchased Companies or any of their Subsidiaries.
(ii) "Company Technology" means all Technology used in or necessary
for the conduct of the business of the Company, the Purchased Companies or
any of their Subsidiaries.
(iii) "Intellectual Property" means all intellectual property rights
arising from or in respect of the following, whether protected, created or
arising under the laws of the United States or any other jurisdiction: (A)
all patents and applications therefor, including continuations,
divisionals, continuations-in-part, or reissues of patent applications and
patents issuing thereon (collectively, "Patents"), (B) all trademarks,
service marks, trade names, service names, brand names, trade dress
rights, logos, Internet domain names and corporate names and general
intangibles of a like nature, together with the goodwill associated with
any of the foregoing, and all applications, registrations and renewals
thereof (collectively, "Marks"), (C) copyrights and registrations and
applications therefor, works of authorship and mask work rights
(collectively, "Copyrights"), (D) proprietary and confidential
information, including without limitation, discoveries, concepts, ideas,
research and development, know-how, formulae, inventions, compositions,
manufacturing and production processes and techniques, technical data,
procedures, designs, drawings, specifications, databases, customer lists,
supplier lists, pricing and cost information, business and marketing plans
and proposals, in each case excluding any rights in respect of any of the
foregoing that comprise or are protected by Copyrights or Patents
(collectively, "Trade Secrets").
(iv) "Software" means any and all (A) computer programs, including
any and all software implementations of algorithms, models, and
methodologies, whether in source code or object code, (B) databases and
compilations, including any and all data and collections of data, whether
machine readable or otherwise, (C) descriptions, flow-charts and other
work product used to design, plan, organize and develop any of the
foregoing, screens, user interfaces, report formats, firmware, development
tools, templates, menus, buttons and icons, and (D) all documentation
including user manuals and other training documentation related to any of
the foregoing.
(v) "Technology" means, collectively, all designs, formulae,
algorithms, procedures, methods, techniques, ideas, know-how, Software,
research and development, technical data, programs, subroutines, tools,
materials, specifications, processes,
21
inventions (whether patentable or unpatentable and whether or not reduced
to practice), apparatus, creations, improvements, and all recordings,
graphs, drawings, reports, analyses, and other writings, and other
tangible embodiments of the foregoing, in any form, whether or not
specifically listed herein, and all related technology, used in,
incorporated in, embodied in, or displayed by any of the foregoing, or
used or useful in the design, development, reproduction, maintenance or
modification of any of the foregoing.
(b) Section 4.14(b) of the Company Disclosure Schedule sets forth
an accurate and complete list of all Patents, registered Marks, pending
applications for registrations of any Marks and unregistered Marks, registered
Copyrights, and pending applications for registration of Copyrights, owned or
filed by the Company, the Purchased Companies or any of their Subsidiaries.
Section 4.14(b) of the Company Disclosure Schedule lists the jurisdictions in
which each such Intellectual Property right has been issued or registered or in
which any application for such issuance and registration has been filed.
(c) The Company, the Purchased Companies or one of their
Subsidiaries is the sole and exclusive owner of all right, title and interest in
and to all of the Patents, the Marks, each of the registered Copyrights and
pending applications therefor filed by the Company, the Purchased Companies or
any of their Subsidiaries and each of the other Copyrights in any works of
authorship prepared by or for Company, the Purchased Companies or their
Subsidiaries that resulted from or arose out of any work performed by or on
behalf of Company, the Purchased Companies or any of their Subsidiaries or by
any employee, officer, consultant or contractor of the Company, the Purchased
Companies or any of their Subsidiaries. The Company, one of the Purchased
Companies or one of their Subsidiaries is listed in the records of the
appropriate United States or foreign agency as the sole owner of record for each
item of registered Company Intellectual Property set forth in Section 4.14(b) of
the Company Disclosure Schedule. The Company, one of the Purchased Companies or
one of their Subsidiaries is the sole and exclusive owner of, or has valid and
continuing rights to use, sell or license, as the case may be, all other
Intellectual Property and Company Technology used, sold or licensed by Company,
the Purchased Companies or any of their Subsidiaries in their businesses. The
Company Intellectual Property owned or exclusively licensed to the Company, the
Purchased Companies or any of their Subsidiaries is free and clear of any and
all Liens (other than Permitted Exceptions); and to the Knowledge of the
Company, each of the issued patents owned or exclusively licensed to the
Company, the Purchased Companies or any of their Subsidiaries are subsisting is
in full force and effect, and are valid and enforceable.
(d) To the Knowledge of the Company, the manufacturing, marketing,
importation, offer for sale, sale or use of any products and services of the
Company, the Purchased Companies and their Subsidiaries do not infringe or
violate any Intellectual Property of any Person. To the Knowledge of the
Company, the business practices and methods of the Company, the Purchased
Companies and their Subsidiaries have not and do not infringe, violate or
constitute an unauthorized use or misappropriation of any Intellectual Property
of any Person and do not infringe, constitute an unauthorized use of, or violate
any other right of any Person (including pursuant to any non-disclosure
agreements or obligations to which Company, the Purchased Companies or any of
their Subsidiaries or any of their present or former employees or consultants is
a party). The Company Intellectual Property and the Company Technology
22
constitute all of the Intellectual Property necessary to enable the Company, the
Purchased Companies or any of their Subsidiaries to conduct their businesses in
the manner which such businesses are conducted.
(e) Section 4.14(e) of the Company Disclosure Schedule sets forth
a complete and accurate list of all material Contracts to which Company, the
Purchased Companies or any of their Subsidiaries is a party (i) granting to any
other Person the rights under any of the Company Intellectual Property or
Company Technology, or (ii) pursuant to which Company, the Purchased Companies
or any of their Subsidiaries is authorized to use any Intellectual Property or
the Technology of any third Person, other than standard purchase orders and end
user licenses used by the Company, the Purchased Companies or any of their
Subsidiaries in the normal course of selling or licensing products to end users
customers and excluding commercial off-the-shelf Software (the Contracts
referred to in clauses (i) and (ii) above, collectively the "Intellectual
Property Licenses").
(i) Each Intellectual Property License is in full force and effect
and is the legal, valid and binding obligation of the Company, the
Purchased Companies or one of their Subsidiaries, enforceable against it
in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, and similar laws affecting
creditors' rights and remedies generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in law or in equity).
(ii) Neither Company, the Purchased Companies nor any of their
Subsidiaries are not in default under any Intellectual Property License,
nor, to the Knowledge of the Company, is any other party to any
Intellectual Property License in default thereunder, and, to the Knowledge
of the Company, no event has occurred that, with the lapse of time or the
giving of notice or both, would constitute a default thereunder.
(iii) No party to any of the Intellectual Property Licenses has
exercised any termination rights with respect thereto.
(f) To the Knowledge of Company, no Person (including employees
and former employees of Company, the Purchased Companies or any of their
Subsidiaries) is infringing, violating, misappropriating or otherwise misusing
any Company Intellectual Property owned by the Company, or to which the Company
has an exclusive license or similar exclusive right and none of the Company, the
Purchased Companies or any of their Subsidiaries have made any such claims
against any Person (including employees and former employees of the Company, the
Purchased Companies or any of their Subsidiaries) and, to the Knowledge of the
Company, there is no reasonable basis for any such claim.
(g) None of the Company, the Purchased Companies or any of their
Subsidiaries is a party to or the subject of any pending or, to the Knowledge of
the Company, any threatened suit, action, investigation or proceeding which
involves a claim (i) against the Company, the Purchased Companies or any of
their Subsidiaries of infringement, unauthorized use, or violation of any
Intellectual Property of any Person, or challenging the ownership, use, validity
or enforceability of any Company Intellectual Property or (ii) contesting the
right of the
23
Company, the Purchased Companies or any of their Subsidiaries to use, sell,
exercise, license, transfer or dispose of any Company Intellectual Property or
Company Technology or any products, processes, or materials covered thereby in
any manner. The Company has not received notice of any such threatened claim,
nor to the Knowledge of the Company, are there any facts or circumstances that
would form the basis for any claim against the Company, the Purchased Companies
or any of their Subsidiaries of (A) infringement, unauthorized use, or violation
of any Intellectual Property of any Person, or (B) challenging the ownership,
use, validity or enforceability of any Company Intellectual Property or Company
Technology. There are no Orders of any Governmental Body to which the Company,
the Purchased Companies or any of their Subsidiaries is a party or by which
Company, the Purchased Companies or any of their Subsidiaries is bound which
restrict the rights to use any of the Company Intellectual Property. The Company
has not received any notice of infringement by the Company, the Purchased
Companies or any of their Subsidiaries of any third party Patents and to the
Knowledge of the Company, no such notices have been received by any of the
Purchased Companies or any their Subsidiaries. None of the Company, the
Purchased Companies or any of their Subsidiaries is seeking or has obtained a
written opinion of counsel relating to any third party Patents.
(h) The Company, the Purchased Companies and their Subsidiaries
have secured valid written assignments from all consultants and employees who
contributed to the creation or development of the Company Intellectual Property
owned by the Company, the Purchased Companies or any of their Subsidiaries or
Company Technology owned by the Company, the Purchased Companies or any of their
Subsidiaries of the rights to such contributions that the Company, the Purchased
Companies or any of their Subsidiaries do not already own by operation of Law.
To the Knowledge of the Company, no present or former consultant or employee has
any right, title or interest, directly or indirectly, in whole or in part, in
any Company Intellectual Property owned by the Company, the Purchased Companies
or any of their Subsidiaries or Company Technology owned by the Company, the
Purchased Companies or any of their Subsidiaries. To the Knowledge of the
Company, no consultant or employee of the Company, the Purchased Companies or
any of their Subsidiaries is, as a result of or in the course of such
consultant's or employee's engagement by the Company, the Purchased Companies or
any of their Subsidiaries, in default or breach of any material term of any
employment or consultant agreement, non-disclosure agreement, or similar
agreement.
(i) No Trade Secret or any other non-public, proprietary
information material to the business of the Company, the Purchased Companies or
any of their Subsidiaries as presently conducted has been authorized to be
disclosed or has been actually disclosed by the Company, the Purchased Companies
or any of their Subsidiaries to any employee or any third party other than
pursuant to a non-disclosure agreement restricting the disclosure and use of the
Company Intellectual Property or Company Technology. The Company, the Purchased
Companies and their Subsidiaries have taken all reasonably necessary and
appropriate steps to protect and preserve the confidentiality of all Trade
Secrets and any other Confidential information of the Company, the Purchased
Companies or any of their Subsidiaries not otherwise protected by patents,
patent applications or copyright owned or filed by the Company, the Purchased
Companies or any of their Subsidiaries ("Confidential Information"). Each
consultant and employee of the Company, the Purchased Companies and their
Subsidiaries has entered into a written non-disclosure agreement with the
Company, the Purchased Companies or any of their Subsidiaries in a form provided
or made available to Purchaser. All use or disclosure or
24
appropriation of Confidential Information by the Company, the Purchased
Companies or any of their Subsidiaries by or to a third party has been pursuant
to the terms of a written agreement between the Company, the Purchased Companies
or any of their Subsidiaries and such third party.
(j) Section 4.14(k) of the Company Disclosure Schedule sets forth
a complete and accurate list of all Software that is owned exclusively by the
Company, the Purchased Companies or any of their Subsidiaries and is material to
the operation of their businesses. It is the Company's, the Purchased Companies'
and their Subsidiaries' practice to scan all Software and data residing on
Company's, the Purchased Companies' and their Subsidiaries' computer network
with a commercially available and up-to-date virus scan software. Software that
is used by the Company in the manufacturing of, or that is incorporated in, the
products of the Company, the Purchased Companies or any of their Subsidiaries
contain no "viruses." For the purposes of this Agreement, "virus" means any
computer code designed to disrupt, disable or harm in any manner the operation
of any software or hardware including worms, bombs, backdoors, clocks, timers,
or other disabling device code, designs or routines which causes the Software to
be erased, inoperable, or otherwise incapable of being used, either
automatically or with passage of time or upon command by any Person, excluding
any standard access key, timers or similar devices designed to limit access of
customers to properly purchased or licensed features or usage levels.
(k) All original equipment manufacturers and suppliers of
components, parts and Software that are incorporated into Company's, the
Purchased Companies' or any of their Subsidiaries' products have agreed to
indemnify the Company, the Purchased Companies or any of their Subsidiaries for
claims that the manufacture, use, sale, offer for sale, or import of such
components, parts and/or Software infringe or violate any Intellectual Property
rights of a third party.
(l) Except pursuant to the Intellectual Property Licenses set
forth in Section 4.14(e), of the Company Disclosure Schedule, the consummation
of the transactions contemplated by this Agreement will not result in (i) the
Purchaser being bound by any non-compete or other restriction on the operation
of any business of the Purchaser; (ii) the granting by the Purchaser of any
rights or licenses to any Intellectual Property of the Purchaser to a third
party; (iii) a material expansion of the scope of obligations that are currently
owed by the Company, the Purchased Companies or any of their Subsidiaries; or
(iv) the loss or impairment of the Company's, the Purchased Companies' or any of
their Subsidiaries' rights under any Company Intellectual Property.
4.15 Material Contracts. Section 4.15 of the Company Disclosure
Schedule sets forth all of the following Contracts to which the Company, the
Purchased Companies or any of their Subsidiaries is a party or by which it is
bound under which there are continuing obligations (other than confidentiality
restrictions) and other than the Company Plans and Contracts made after the date
hereof as permitted by or in compliance with Section 6.2 (collectively, the
"Material Contracts"): (i) Contracts with any current officer or director of the
Company, the Purchased Companies or any of their Subsidiaries; (ii) Contracts
with any labor union or association representing any employee of the Company,
the Purchased Companies or any of their Subsidiaries; (iii) Contracts pursuant
to which any party is required to purchase or
25
sell a stated portion of its requirements or output from or to another party;
(iv) Contracts for the sale of any of the assets of the Company, the Purchased
Companies or any of their Subsidiaries other than in the Ordinary Course of
Business or for the grant to any person of any preferential rights to purchase
any of its assets; (v) joint venture agreements; (vi) Contracts containing
covenants of the Company, the Purchased Companies or any of their Subsidiaries
not to compete in any line of business or with any person in any geographical
area or covenants of any other person not to compete with the Company, the
Purchased Companies or any of their Subsidiaries in any line of business or in
any geographical area; (vii) Contracts relating to the acquisition by the
Company, the Purchased Companies or any of their Subsidiaries of any operating
business or the capital stock of any other person; (viii) Contracts relating to
the borrowing of money; (ix) any distributor, supplier (as such term is used in
the Company SEC Documents), advertising, agency or manufacturer's representative
Contract; (x) agreement of guarantee, support, assumption or endorsement of, or
any similar commitment with respect to the Liability or Indebtedness of any
other Person; (xi) trust indenture, mortgage, promissory note, loan agreement or
(xii) other Contracts, other than Real Property Leases, which involve the
expenditure by the Company, the Purchased Companies or any of their Subsidiaries
of more than $150,000 in the aggregate or $25,000 annually or require
performance by any party more than one year from the date hereof or are
otherwise material to the Company, the Purchased Companies and any of their
Subsidiaries taken as a whole. The Company, the Purchased Companies and their
Subsidiaries have provided or made available to the Purchaser true and complete
copies of all of the written Material Contracts and written summaries of the
material terms of all of the oral Material Contracts. All of the Material
Contracts and other agreements are in full force and effect and are the legal,
valid and binding obligation of the Company, the Purchased Companies and/or any
of their Subsidiaries, enforceable against them in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and subject, as
to enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity). None of the Company,
the Purchased Companies or any of their Subsidiaries is in default in any
material respect under any Material Contract, nor, to the Knowledge of the
Company, the Purchased Companies or any of their Subsidiaries, is any other
party to any Material Contract in default thereunder in any material respect.
4.16 Employee Benefits Plans.
(a) Section 4.16(a) of the Company Disclosure Schedule sets forth
a correct and complete list, by country, of each "employee benefit plan," as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), each bonus, stock option, stock purchase, incentive,
deferred compensation, retirement, severance and other employee benefit plans,
programs and arrangements, and each employment and compensation agreement (other
than employment agreements that do not provide for severance, change in control
or similar payments), which is maintained, contributed to, or required to be
contributed to by the Company, the Purchased Companies, any of their
Subsidiaries or any ERISA Affiliates for the benefit of any current or former
employee, director or consultant of the Company, the Purchased Companies or any
of their Subsidiaries (each an "Employee"), or with respect to which the
Company, any of the Purchased Companies, or any of their Subsidiaries has or may
have any liability or obligation (collectively, the "Company Plans").
26
(b) The Company has provided or made available to Purchaser
correct and complete copies of: (i) each Company Plan and all material
amendments thereto, all related trust documents, and all material written
agreements and contracts that are currently in effect relating to each Company
Plan; (ii) each material consulting, relocation or repatriation agreement
between the Company, the Purchased Companies, or any of their Subsidiaries and
any Employee; (iii) the two most recent tax returns (if any) for each Company
Plan, if any; (iv) the most recent summary plan description, if any, with
respect to each Company Plan; (v) the last approval letter, if any, from any
Governmental Body relating to favorable tax treatment with respect to each
Company Plan; (vi) all material correspondence to or from any governmental
agency pertaining to any of the Company Plans, in each case which was sent or
received in the last two years; (vii) a list of all retirement plans terminated
by the Company, the Purchased Companies or any of their Subsidiaries; (viii) all
discrimination tests, if any, for each Company Plan for the most recent two plan
years; (ix) the last two annual actuarial valuations, if any, prepared for each
Company Plan; (x) if the Company Plan is funded, the most recent annual and
periodic accounting of the Company Plan's assets; (xi) all material
communications to Employees regarding in each case, relating to any amendments,
terminations, establishments, increases or decreases in benefits, acceleration
of payments or vesting schedules or other events which would result in any
material liability under any Company Plan or proposed Company Plan that were
given within the last year; and (xii) all prospectuses prepared in connection
with any Company Plan. None of the Company, the Purchased Companies or any of
their Subsidiaries has announced a plan or legally binding commitment to create
any additional Company Plans with respect to any Employees or to amend or modify
any Company Plans, except as contemplated by this Agreement.
(c) Neither the Company nor any ERISA Affiliate within the United
States sponsors, maintains or contributes or has ever sponsored, maintained or
contributed to (i) any plan subject to Title IV of ERISA or Section 412 of the
Code, (ii) any "multiemployer plan," as defined in Section 3(37) of ERISA, or
(iii) any plan described in Section 413 of the Code. All liabilities with
respect to Company Plans that provide health benefits that are not fully insured
through an insurance contract are accrued in compliance with GAAP and all such
Company Plans are covered by stop-loss insurance policies that have been
previously provided to Purchaser. No Company Plan is funded by, associated with
or related to a "voluntary employee's beneficiary association" within the
meaning of Section 501(c)(9) of the Code.
(d) The Company Plans have been maintained in all material
respects in accordance with their terms and with all provisions of ERISA, the
Code (including rules and regulations thereunder) and other applicable Federal
and state Laws and regulations, and none of the Company, the Purchased Companies
or any of their Subsidiaries or any "party in interest" or "disqualified person"
with respect to the Company Plans has engaged in a non-exempt "prohibited
transaction" within the meaning of Section 4975 of the Code or Section 406 of
ERISA or is subject to any liability or penalty under Section 4975 through 4980B
of the Code or Title I of ERISA. None of the Company, the Purchased Companies or
any their Subsidiaries, nor any officer or director of the Company, any of the
Purchased Companies or any of their Subsidiaries, has any liability under
Section 4975 through 4980B of the Code or Title I of ERISA, except for the
continuation of health care benefits under the Company Plans in the ordinary
Course of Business.
27
(e) The Company Plans intended to qualify under Section 401 of the
Code are so qualified and any trusts intended to be exempt from federal income
taxation under Section 501 of the Code are so exempt, and nothing has occurred
with respect to the operation of the Company Plans that would reasonably be
expected to cause the loss of such qualification or exemption or the imposition
of any material liability, penalty or tax under ERISA or the Code. Each Company
Plan required to be registered or approved by a Governmental Body has been
registered with, or approved by, and has been maintained, in all material
respects, in good standing with the applicable Governmental Body and nothing has
occurred with respect to the operation of such Company Plans which is reasonably
likely to cause the loss of such good standing or the imposition of any material
liabilities, penalty or tax under applicable law.
(f) Each Company Plan that is intended to meet the requirements
for tax-favored treatment under Subchapter B of Chapter 1 of Subtitle A of the
Code has been operated in a manner that is intended to meet such requirements.
(g) None of the Company, the Purchased Companies or any of their
Subsidiaries is currently obligated to provide an Employee with any compensation
or benefits pursuant to an agreement (e.g., an acquisition agreement) with a
former employer of such Employee.
(h) None of the Company, the Purchased Companies or any of their
Subsidiaries has violated Section 402 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
(i) The present value of the accrued benefit liabilities (whether
or not vested) under each Company Plan that is maintained outside the United
States primarily for the benefit of persons substantially all of whom are not
resident in the United States that provides pension, retirement, early
retirement, profit-sharing, deferred compensation or other similar benefits
(each, a "Non-U.S. Retirement Plan"), determined as of the date of this
Agreement, either does not exceed the current value of the assets of such
Non-U.S. Retirement Plan allocable to such benefit liabilities or any such
excess has been accrued and reflected in the Balance Sheet. All benefits
(whether or not vested) earned by Employees that will be payable after the date
of this Agreement, under each Non-U.S. Retirement Plan are properly accrued and
reflected in the Balance Sheet (except for benefits (whether or not vested)
earned by employees in the Ordinary Course of Business after the Balance Sheet
Date). Section 4.16(i) of the Company Disclosure Schedule sets forth each
unfunded Company Plan whose accrued Liabilities are not reflected in the Balance
Sheet.
(j) All contributions (including all employer contributions and
employee salary reduction contributions) required to have been made under any of
the Company Plans (including workers compensation) or by Law, to any funds or
trusts established thereunder or in connection therewith have been made by the
due date thereof (including any valid extension), except for any insignificant
delays or delinquencies, and all contributions for any period ending on or
before the Closing Date that are not yet due will have been paid in accordance
with the applicable Company Plan, or sufficient accruals for such contributions
and other payments in accordance with GAAP are duly and fully provided for on
the Balance Sheet (except for Liabilities for contributions or payments accruing
in the Ordinary Course of Business after the Balance Sheet Date).
28
(k) Neither the Company nor any ERISA Affiliate or any
organization to which the Company is a successor or parent corporation within
the meaning of Section 4069(b) of ERISA has engaged in any transaction within
the meaning of Section 4069 or 4212(c) of ERISA.
(l) There are no pending actions, claims or lawsuits that have
been asserted or instituted against the Company Plans, the assets of any of the
trusts under the Company Plans or the sponsor or administrator of any of the
Company Plans, or against any fiduciary of the Company Plans with respect to the
operation of any of the Company Plans (other than routine benefit claims), nor,
to the Knowledge of the Company, are there any facts that would reasonably be
expected to form the basis for any such claim or lawsuit.
(m) There is no material violation of ERISA, the Code or other
applicable Laws with respect to the filing of applicable reports, documents and
notices regarding the Company Plans with the applicable Governing Body or the
furnishing of such documents to the participants in or beneficiaries of the
Company Plans. All amendments and actions required to bring the Company Plans
into conformity in all material respects with all of the applicable provisions
of the Code, ERISA and other applicable Laws have been made or taken.
(n) None of the Company Plans provides for post-employment life,
disability (except for disability benefits based on pre-termination events) or
health insurance, benefits or coverage for any participant or any beneficiary of
a participant, except as may be required by applicable Law (including, without
limitation, the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA"), and at the expense of the participant or the participant's
beneficiary. Each of the Company and any ERISA Affiliate which maintains a
"group health plan" within the meaning Section 5000(b)(1) of the Code has
complied with the notice and continuation requirements of Section 4980B of the
Code, COBRA, Part 6 of Subtitle B of Title I of ERISA and the regulations
thereunder, if and to the extent such requirements are applicable.
(o) Except as contemplated by this Agreement, the execution of
this Agreement and the consummation of the transactions contemplated by this
Agreement will not (whether alone or upon the occurrence of any additional or
subsequent events) constitute an event under any Company Plan, trust or loan
that will or may result in any payment (whether of severance pay or otherwise),
acceleration, forgiveness of Indebtedness, vesting, distribution, increase in
benefits or obligation to fund benefits. No Company Plan provides for severance
or change of control benefits or a notice period upon termination of employment
of more than three (3) months.
(p) No payment or benefit which has been, will be or may be made
pursuant to the Agreement or by the Company, the Purchased Companies, or any of
their Subsidiaries with respect to any Person may be characterized as a
"parachute payment," within the meaning of Section 280G(b)(2) of the Code.
(q) No stock or other security issued by the Company, the
Purchased Companies or any of their Subsidiaries forms or has formed a material
part of the assets of any Company Plan, except for the Company Stock Plans and
ESPP. All securities issued to Employees pursuant to Company Plans have been
issued in compliance with applicable Laws.
29
The Company, the Purchased Companies and their Subsidiaries have withheld and
reported all amounts required to be withheld and reported pursuant to applicable
Laws with respect to securities issued to Employees located outside of the
United States pursuant to Company Plans and Section 4.16(q) of the Company
Disclosure Schedule sets forth a correct and complete list of all jurisdictions
where the Company, the Purchased Companies or their Subsidiaries may be liable
for social taxes with respect to securities issued to Employees located outside
of the United States.
(r) None of the Company, the Purchased Companies or any of their
Subsidiaries is liable for any material payment to any trust or other fund
governed by or maintained by or on behalf of any governmental authority, with
respect to unemployment compensation benefits, social security or other benefits
or obligations for Employees (other than routine payments to be made in the
normal course of business and consistent with past practice). There are no
pending, threatened or reasonably anticipated claims or actions against the
Company, the Purchased Companies or any of their Subsidiaries under any worker's
compensation policy or long-term disability policy (other than routine claims
for benefits). None of the Company, the Purchased Companies or any of their
Subsidiaries has direct or indirect liability with respect to any
misclassification of any person as an independent contractor rather than as an
employee, or with respect to any employee leased from another employer.
4.17 Employees and Labor. None of the Employees is represented in
his or her capacity as an employee of the Company, the Purchased Companies or
any of their Subsidiaries by any labor organization. None of the Company, the
Purchased Companies or any of their Subsidiaries has recognized any labor
organization, or has any labor organization been elected as the collective
bargaining agent of any Employees. None of the Company, the Purchased Companies
or any of their Subsidiaries has entered into any collective bargaining
agreement or union contract recognizing any labor organization as the bargaining
agent of any Employees. There is no union organization activity involving any of
the Employees, pending or threatened, nor has there ever been union
representation involving any of the Employees in the Employees' capacities as
employees of the Company, the Purchased Companies or any of their Subsidiaries.
There is no picketing, pending or, to the Knowledge of the Company, threatened,
and there are no strikes, slowdowns, work stoppages, other job actions,
lockouts, arbitrations, grievances or other labor disputes involving any of the
Employees, pending, or to the Knowledge of the Company, threatened; nor to the
Knowledge of the Company is there any reasonable basis for such actions. There
are no complaints, charges or claims against the Company, the Purchased
Companies or any of their Subsidiaries pending or, to Knowledge of the Company
threatened, to be brought by or filed with any Governmental Body based on,
arising out of, in connection with or otherwise relating to the employment or
termination of employment or failure to employ by the Company, the Purchased
Companies or any of their Subsidiaries, of any individual, and to the Knowledge
of the Company, there is no reasonable basis for any such complaint, charge or
claim. Each of the Company, the Purchased Companies and their Subsidiaries is in
compliance with all Laws relating to the employment of labor, including all such
Laws relating to wages, hours, the Worker Adjustment and Retraining Notification
Act and any similar state, local, national or foreign "mass layoff" or "plant
closing" Law in all applicable jurisdictions relating to the employment of labor
("WARN"), collective bargaining, discrimination, civil rights, safety and
health, workers' compensation and the collection and payment of withholding
and/or social security taxes and any similar tax except for immaterial
non-compliance. There has been no
30
"mass layoff" or "plant closing" (as defined by WARN) with respect to the
Company, the Purchased Companies or any of their Subsidiaries within the six (6)
months prior to Closing.
4.18 Litigation. There is no suit, action, proceeding,
investigation, claim or order pending or, to the Knowledge of the Company,
threatened against the Company, the Purchased Companies or any of their
Subsidiaries (or to the Knowledge of the Company, pending or threatened against
any of the officers, directors or key employees of the Company, the Purchased
Companies or any of their Subsidiaries with respect to their business activities
on behalf of the Company, the Purchased Companies or any of their Subsidiaries),
or to which the Company, the Purchased Companies or any of their Subsidiaries is
otherwise a party, before any court, or before any governmental department,
commission, board, agency, or instrumentality; nor to the Knowledge of the
Company, is there any reasonable basis for any such action, proceeding, or
investigation. None of the Company, the Purchased Companies or any of their
Subsidiaries is subject to any Order except to the extent the same are not
reasonably likely to have a Material Adverse Effect, and none of the Company,
the Purchased Companies or any of their Subsidiaries is engaged in any legal
action to recover monies due it or for damages sustained by it.
4.19 Compliance with Laws; Permits.
(a) The Company, the Purchased Companies and their Subsidiaries
are in compliance in all material respects with all Laws of any Governmental
Body applicable to their business or operations. None of the Company, the
Purchased Companies or any of their Subsidiaries has received any written or
other notice of or been charged with the violation of any Laws. To the Knowledge
of the Company, none of the Company, the Purchased Companies or any of their
Subsidiaries is under investigation with respect to the violation of any Laws
and, to the Knowledge of the Company, there are no facts or circumstances that
would reasonably be expected to form the basis for any such violation. The
Company, the Purchased Companies and their Subsidiaries currently have all
Permits which are required for the operation of the Business as presently
conducted.
(b) None of the Company, the Purchased Companies or any of their
Subsidiaries is in default or violation (and no event has occurred which, with
notice or the lapse of time or both, would constitute a default or violation) in
any material respect of any term, condition or provision of any Permit to which
it is a party, to which its business is subject or by which its properties or
assets are bound, and to the knowledge of the Company there are no facts or
circumstances which would reasonably form the basis for any such default or
violation.
4.20 Environmental Matters.
(a) The operations of the Company, the Purchased Companies and
their Subsidiaries are and have been in compliance with all applicable
Environmental Laws which compliance includes obtaining, maintaining in good
standing and complying with all Permits required by Environmental Laws
("Environmental Permits") and no action or proceeding is pending or, to the
Knowledge of the Company, threatened to revoke, modify or terminate any such
Environmental Permit. To the Knowledge of the Company, no facts, circumstances
or conditions currently exist that would reasonably be expected to adversely
affect such continued
31
compliance with Environmental Laws and Environmental Permits or require
currently unbudgeted capital expenditures to achieve or maintain such continued
compliance with Environmental Laws and Environmental Permits.
(b) None of the Company, the Purchased Companies or any of their
Subsidiaries is the subject of any outstanding written order or Contract with
any governmental authority or person respecting (i) Environmental Laws, (ii)
Remedial Action or (iii) any Release or threatened Release of a Hazardous
Material.
(c) No claim has been made or is pending, or to the Knowledge of
the Company, threatened against the Company, the Purchased Companies or any of
their Subsidiaries alleging either or both that the Company may be in violation
of any Environmental Law or Environmental Permit, or may have any liability
under any Environmental Law.
(d) No facts, circumstances or conditions exist with respect to
the Company, the Purchased Companies or any of their Subsidiaries or any
property currently or formerly owned, operated or leased by the Company, the
Purchased Companies or any of their Subsidiaries or any property to which the
Company, the Purchased Companies or any of their Subsidiaries arranged for the
disposal or treatment of Hazardous Materials that would reasonably be expected
to result in the Company, the Purchased Companies or any of their Subsidiaries
incurring unbudgeted Environmental Costs and Liabilities.
(e) There are (i) no pending investigations of the business,
operations, or currently, or previously owned, operated or leased property of
the Company, the Purchased Companies or any of their Subsidiaries that could
lead to the imposition of any Environmental Costs and Liabilities or Liens under
Environmental Laws and (ii) to the Knowledge of the Company, there are no
investigations threatened against the business, operations, or currently or
previously, owned operated or leased property of the Company, the Purchased
Companies or any of their Subsidiaries that would reasonably be expected to lead
to the imposition of any Environmental Costs and Liabilities or Liens under
Environmental Laws.
(f) There is not located at any of the properties of the Company,
the Purchased Companies of any of their Subsidiaries any (i) underground storage
tanks, (ii) asbestos-containing material or (iii) equipment containing
polychlorinated biphenyls.
(g) The transaction contemplated hereunder does not require the
consent of or filings with any governmental authority with jurisdiction over the
Company, the Purchased Companies or any of their Subsidiaries and environmental
matters, and no real estate owned or leased by the Company, the Purchased
Companies or any of their Subsidiaries is located in New Jersey or Connecticut.
(h) The Company, the Purchased Companies and their Subsidiaries
have provided or made available to the Purchaser all environmentally related
audits, studies, reports, analyses, and results of investigations that (i) have
been performed with respect to the currently or previously owned, leased or
operated properties of the Company, the Purchased Companies or any of their
Subsidiaries, and (ii) are possessed by the Company, the Purchased Companies or
any of their Subsidiaries.
32
4.21 Insurance. Section 4.21 of the Company Disclosure Schedule
sets forth a complete and accurate list of all policies of insurance of any kind
or nature covering the Company, the Purchased Companies or any of their
Subsidiaries or any of their respective employees, properties or assets,
including, without limitation, policies of life, disability, fire, theft,
workers compensation, employee fidelity and other casualty and liability
insurance. All such policies are in full force and effect, and, to the Knowledge
of the Company, none of the Company, the Purchased Companies or any of their
Subsidiaries is in default of any provision thereof, except for such defaults as
would not, individually or in the aggregate, have a Material Adverse Effect.
4.22 Inventories; Receivables; Payables.
(a) Except to the extent reflected in the Balance Sheet, the
inventories of the Company, the Purchased Companies and their Subsidiaries are
usable and, with respect to finished goods, are in good and marketable
condition, and are saleable in the Ordinary Course of Business. Adequate
reserves have been reflected in the Balance Sheet for shorts, obsolete or
otherwise unusable inventory, which reserves were calculated in a manner
consistent with past practice and in accordance with GAAP consistently applied.
(b) All accounts receivable of the Company, the Purchased
Companies or any of their Subsidiaries have arisen from bona fide transactions
in the Ordinary Course of Business consistent with past practice. All accounts
receivable of the Company, the Purchased Companies and their Subsidiaries
reflected on the Balance Sheet are good and collectible at the aggregate
recorded amounts thereof, net of any applicable reserve for returns or doubtful
accounts reflected thereon, which reserves were calculated in a manner
consistent with past practice and in accordance with GAAP consistently applied.
All accounts receivable arising after the Balance Sheet Date are good and
collectible at the aggregate recorded amounts thereof, net of any applicable
reserve for returns or doubtful accounts, which reserves were calculated in a
manner consistent with past practice and in accordance with GAAP consistently
applied.
(c) All accounts payable of the Company, the Purchased Companies
and their Subsidiaries reflected in the Balance Sheet or arising after the date
thereof are the result of bona fide transactions in the Ordinary Course of
Business and have been paid or are not yet due and payable.
4.23 Related Party Transactions. Except as disclosed in the Company
SEC Documents filed and publicly available prior to the date of this agreement,
none of the Company, the Purchased Companies or any of their Subsidiaries is
indebted to any director, officer or employee of the Company, the Purchased
Companies or any of their Subsidiaries (except for amounts due as normal
salaries and bonuses and in reimbursement of ordinary expenses) and no such
person is indebted to the Company, the Purchased Companies or any of their
Subsidiaries, and there are no other transactions of the type required to be
disclosed pursuant to Item 404 of Regulation S-K under the Securities Act and
the Exchange Act.
4.24 Customers and Suppliers. Section 4.24 of the Company
Disclosure Schedule sets forth a list of the twenty (20) largest customers and
the twenty (20) largest suppliers of the Company, the Purchased Companies and
their Subsidiaries (as such term is used
33
in the Company SEC Documents), taken as a whole, as measured by the dollar
amount of purchases therefrom or thereby, during the fiscal year ended May 31,
2004, showing the approximate total sales by the Company, the Purchased
Companies and their Subsidiaries to each such customer and the approximate total
purchases by the Company, the Purchased Companies and their Subsidiaries from
each such supplier, during such period. Since May 31, 2004, to the Knowledge of
the Company, there has not been any material adverse change in the business
relationship of the Company, the Purchased Companies or any of their
Subsidiaries with any customer or supplier listed on Section 4.24 of the Company
Disclosure Schedule.
4.25 Banks. Section 4.25 of the Company Disclosure Schedule
contains a complete and correct list of the names and locations of all banks in
which the Company, the Purchased Companies or any of their Subsidiaries have
accounts or safe deposit boxes and the names of all persons authorized to draw
thereon or to have access thereto. No person holds a power of attorney to act on
behalf of the Company, the Purchased Companies or any of their Subsidiaries.
4.26 Vote Required. The affirmative vote of a two-thirds (2/3)
majority of the valid votes cast at the Company Shareholders Meeting either in
person or by proxy or any adjournment or postponement thereof, which a
two-thirds (2/3) majority represents a majority of the issued share capital (the
"Company Shareholder Approval"), is the only vote of the holders of any class or
series of the capital stock of the Company necessary to approve this Agreement,
the Transaction and the transactions contemplated hereby.
4.27 Financial Advisors. Except for Perseus Advisors, LLC, no
Person has acted, directly or indirectly, as a broker, finder or financial
advisor for the Company, the Purchased Companies or any of their Subsidiaries in
connection with the transactions contemplated by this Agreement or is entitled
to any fee, commission or reimbursement of expenses or like payment in respect
thereof.
4.28 Opinion of Financial Advisor. The Company has received the
opinion of Perseus Advisors, LLC to the effect that, as of the date hereof, the
Purchase Price is fair to the Company from a financial point of view.
4.29 Title to Purchased Assets; Sufficiency. The Company, the
Purchased Companies and their Subsidiaries own and have good title to each of
the Purchased Assets, free and clear of all Liens other than Permitted
Exceptions. The Purchased Assets constitute all of the properties and assets
used in or held for use in the Business (other than the Excluded Assets) and are
sufficient for Purchaser to conduct the Business (other than as it relates to
the Excluded Assets) from and after the Closing Date without interruption and in
the Ordinary Course of Business as it has been conducted by the Company, the
Purchased Companies and their Subsidiaries. Section 4.29 of the Company
Disclosure Schedule sets forth all of the assets, properties, material
Contracts, and registered Intellectual Property related to the Business held by
and in the name of the Company.
34
4.30 No Misrepresentation. Neither this Agreement (including the
Company Disclosure Schedule) nor any document, certificate or instrument
furnished in connection therewith contains, with respect to the Company, the
Purchased Companies and their Subsidiaries, any untrue statement of a material
fact or omits to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. To the
Knowledge of the Company there is no fact which has or would reasonably be
expected in the future to result in a Material Adverse Effect and which has not
been set forth in the Company SEC Documents or in this Agreement (including the
Company Disclosure Schedule).
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
The Purchaser hereby represents and warrants to the Company that:
5.1 Organization and Good Standing. The Purchaser is a corporation
validly existing and in good standing under the laws of the State of Delaware.
5.2 Authorization of Agreement. The Purchaser has full corporate
power and authority to execute and deliver this Agreement, the Voting
Agreements, the Non-Competition Agreements, the Assignment and Assumption
Agreement, the Indemnity Agreement and each other agreement, document,
instrument or certificate contemplated by this Agreement or to be executed by
the Purchaser in connection with the consummation of the transactions
contemplated hereby and thereby and to consummate the transactions contemplated
hereby and thereby. The execution, delivery and performance by the Purchaser of
this Agreement, the Voting Agreements, the Non-Competition Agreements, the
Assignment and Assumption Agreement and the Indemnity Agreement have been duly
authorized by all necessary corporate action on behalf of the Purchaser. This
Agreement and the Voting Agreements have been, and at or prior to the Closing,
the Non-Competition Agreements, the Assignment and Assumption Agreement and the
Indemnity Agreement will be, duly executed and delivered by the Purchaser and
(assuming the due authorization, execution and delivery by the other parties
hereto and thereto) this Agreement and the Voting Agreements constitutes, and
the Non-Competition Agreements, the Assignment and Assumption Agreement and the
Indemnity Agreement (when so executed and delivered) will constitute legal,
valid and binding obligations of the Purchaser, enforceable against the
Purchaser in accordance with their respective terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability, to
general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity).
5.3 Conflicts; Consents of Third Parties.
(a) Neither of the execution and delivery by the Purchaser of this
Agreement, the Voting Agreements, the Assignment and Assumption Agreement and
the Indemnity Agreement, nor the compliance by the Purchaser with any of the
provisions hereof or thereof will
35
(i) conflict with, or result in the breach of, any provision of the certificate
of incorporation or bylaws of the Purchaser, (ii) conflict with, violate, result
in the breach of, or constitute a default under any note, bond, mortgage,
indenture, license, agreement or other obligation to which the Purchaser is a
party or by which the Purchaser or its properties or assets are bound or (iii)
violate any statute, rule, regulation, order or decree of any governmental body
or authority by which the Purchaser is bound, except, in the case of clauses
(ii) and (iii), for such violations, breaches or defaults as would not,
individually or in the aggregate, have a material adverse effect on the
business, properties, results of operations, prospects, condition (financial or
otherwise) of the Purchaser and its subsidiaries, taken as a whole.
(b) No consent, waiver, approval, Order, Permit or authorization
of, or declaration or filing with, or notification to, any Person or
Governmental Body is required on the part of the Purchaser in connection with
the execution and delivery of this Agreement, the Voting Agreements, the
Non-Competition Agreements, the Assignment and Assumption Agreement and the
Indemnity Agreement or the compliance by Purchaser with any of the provisions
hereof or thereof, except for compliance with (i) the applicable requirements of
the HSR Act or (ii) other Antitrust Laws.
5.4 Litigation. There are no Legal Proceedings pending or, to the
knowledge of the Purchaser, threatened that are reasonably likely to prohibit or
restrain the ability of the Purchaser to enter into this Agreement or consummate
the transactions contemplated hereby.
5.5 Investment Intention. The Purchaser is acquiring the Shares
for its own account, for investment purposes only and not with a view to the
distribution (as such term is used in Section 2(11) of the Securities Act)
thereof. Purchaser understands that the Shares have not been registered under
the Securities Act and cannot be sold unless subsequently registered under the
Securities Act or an exemption from such registration is available.
5.6 Financial Advisors. Except for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, no Person has acted, directly or indirectly, as a broker, finder
or financial advisor for the Purchaser in connection with the transactions
contemplated by this Agreement and no person is entitled to any fee or
commission or like payment in respect thereof.
ARTICLE VI
COVENANTS AND AGREEMENTS
6.1 Access to Information; Confidentiality.
(a) The Company agrees that, prior to the Closing Date, the
Purchaser shall be entitled, at its expense and through its officers, employees
and representatives (including, without limitation, its legal advisors and
accountants), to make such investigation of the properties, businesses and
operations of the Company, the Purchased Companies and their Subsidiaries and
such examination of the books, records and financial condition of the Company,
the purchased Companies and their Subsidiaries as it reasonably requests and to
make extracts and copies of such books and records. Any such investigation and
examination shall be conducted during regular business hours and under
reasonable circumstances, and the Company
36
shall cooperate, and shall cause the Company, the Purchased Companies and their
Subsidiaries to cooperate, fully therein. No investigation by the Purchaser
prior to or after the date of this Agreement shall diminish or obviate any of
the representations, warranties, covenants or agreements of the Company
contained in this Agreement. In order that the Purchaser may have full
opportunity to make such physical, business, accounting and legal review,
examination or investigation as it may reasonably request of the affairs of the
Company, the Purchased Companies and their Subsidiaries, the Company shall cause
the officers, employees, consultants, agents, accountants, attorneys and other
representatives of the Company, the Purchased Companies and their Subsidiaries
to cooperate fully with such representatives in connection with such review and
examination.
(b) From and after the Closing until the date the Company is fully
and finally liquidated and dissolved (i) the Company may retain copies of such
financial information and similar records relating to any period prior to the
Closing as will be required for the Company and its representatives to prepare
and file the Company Tax Returns and effectuate the Company's liquidation and
dissolution (the "Retained Records") and (ii) the Purchaser shall provide the
Company and its representatives with access (upon reasonable notice and at
reasonable times during normal business hours and in such a manner as to not
interfere with the Purchaser's normal business operations) to such financial
information and similar records. Except for such Retained Records that the
Company may be required pursuant to applicable Law to retain for a period of
time subsequent to the Company's dissolution and liquidation, on or prior to the
date the Company is fully and finally liquidated and dissolved, the Company
shall return all copies of the Retained Records to the Purchaser; provided, that
any Retained Records so retained by the Company shall be returned to the
Purchaser when no longer required under applicable Law to be retained by the
Company.
(c) Except for disclosures expressly permitted by the terms of the
Bilateral Confidentiality Agreement dated as of June 21, 2004, between Purchaser
and the Company (as it may be amended from time to time, the "Confidentiality
Agreement"), Purchaser shall hold, and shall cause its officers, employees,
accountants, counsel, financial advisors and other Representatives to hold, all
information received from the Company, directly or indirectly, in confidence in
accordance with the Confidentiality Agreement.
6.2 Conduct of the Business Pending the Closing.
(a) Except (i) as otherwise expressly contemplated by this
Agreement, (ii) as set forth on Schedule 6.2(a), (iii) as Purchaser may consent
in writing (which consent shall not be unreasonably withheld, conditioned or
delayed) and (iv) to the extent prohibited by applicable Law or the regulations
or requirements of any stock exchange or regulatory organization applicable to
the Company, the Purchased Companies or their Subsidiaries, the Company shall,
and shall cause the Purchased Companies and their Subsidiaries to:
(i) conduct the respective businesses of the Company, the
Purchased Companies and their Subsidiaries only in the Ordinary Course of
Business;
(ii) use commercially reasonable efforts to (A) preserve the
present business operations, organization (including, without limitation,
management and the sales force)
37
and goodwill of the Company, the Purchased Companies and their
Subsidiaries and (B) preserve its present relationship with Persons having
business dealings with the Company, the Purchased Companies and their
Subsidiaries;
(iii) (A) maintain all of the assets and properties of the Company,
the Purchased Companies and their Subsidiaries in their current condition,
ordinary wear and tear excepted and (B) maintain (to the extent available)
insurance upon all of the properties and assets of the Company, the
Purchased Companies and their Subsidiaries in such amounts and of such
kinds comparable to that in effect on the date of this Agreement;
(iv) (A) maintain the books, accounts and records of the Company,
the Purchased Companies and their Subsidiaries in the Ordinary Course of
Business, (B) continue to collect accounts receivable and pay accounts
payable in the Ordinary Course of Business utilizing normal procedures and
without discounting, deferring or accelerating payment of such accounts
except for such actions taken in the Ordinary Course of Business that
individually, and in the aggregate, are not material, and (C) use its
commercially reasonable efforts to comply with all contractual and other
obligations applicable to the operation of the Company, the Purchased
Companies and their Subsidiaries; and
(v) comply in all material respects with applicable laws,
including, without limitation, Environmental Laws.
(b) Except as otherwise expressly permitted by this Agreement or
as provided on Schedule 6.2(b), and except to the extent required by applicable
Law or the regulations or requirements of any stock exchange or regulatory
organization applicable to the Company, the Purchased Companies or their
Subsidiaries, the Company shall not, and shall cause the Purchased Companies and
their Subsidiaries not to (without the prior written consent of the Purchaser,
which consent shall not be unreasonably withheld, conditioned or delayed):
(i) (A) declare, set aside, make or pay any dividend or other
distribution in respect of the capital stock of the Company, any of the
Purchased Companies or any Subsidiaries, other than dividends or
distributions by a wholly-owned subsidiary of a Purchased Company to such
Purchased Company (or other than in connection with compliance with
Section 6.16), or (B) other than pursuant to existing written Contracts
listed on Schedule 6.2(b)(i), repurchase, redeem or otherwise acquire any
outstanding shares of the capital stock or other securities of, or other
ownership interests in, the Company, the Purchased Companies and their
Subsidiaries;
(ii) transfer, issue, sell or dispose of any shares of capital
stock or other securities of the Company, the Purchased Companies or any
of their Subsidiaries or grant options, warrants, calls or other rights to
purchase or otherwise acquire shares of the capital stock or other
securities of the Company, the Purchased Companies or any of their
Subsidiaries, except that the Company may (A) grant stock options under
the Company Stock Plans in the Ordinary Course of Business; (B) issue
shares of Company Common Stock pursuant to the ESPP and upon the exercise
of options outstanding on the date
38
hereof (or that are granted or issued after the date of this Agreement in
compliance with this Agreement) under the Company Stock Plans; and (C)
issue shares of Company Common Stock upon the exercise of Warrants or
conversion of Convertible Securities;
(iii) effect any recapitalization, reclassification, stock split or
like change in the capitalization of the Company, the Purchased Companies
or any of their Subsidiaries;
(iv) amend the certificate of incorporation, articles of
association, bylaws or other organizational documents of the Company, the
Purchased Companies or any of their Subsidiaries;
(v) (A) increase the annual level of compensation (including
equity compensation, whether payable in cash, stock or other property) of
any employee, director or consultant of the Company, the Purchased
Companies or any of their Subsidiaries, (B) grant any unusual or
extraordinary bonus, benefit or other direct or indirect compensation to
any employee, director or consultant, (C) increase the coverage or
benefits available under any (or create any new) severance pay,
termination pay, vacation pay, company awards, salary continuation for
disability, sick leave, deferred compensation, bonus or other incentive
compensation, insurance, pension or other employee benefit plan or
arrangement made to, for, or with any of the directors, officers,
employees, agents or representatives of the Company, the Purchased
Companies or any of their Subsidiaries or otherwise modify or amend or
terminate any such plan or arrangement or (D) enter into any employment
(other than to the extent providing for "at-will" employment and without
severance), deferred compensation, severance, consulting, non-competition
or similar agreement (or amend any such agreement) to which the Company,
the Purchased Companies or any of their Subsidiaries is a party or
involving a director, officer or employee of the Company, the Purchased
Companies or any of their Subsidiaries in his or her capacity as a
director, officer or employee of the Company, the Purchased Companies or
any of their Subsidiaries; provided, however, that notwithstanding the
foregoing, the Company may amend the Company Stock Plans to accelerate the
vesting of options issued under the Company Stock Plans in connection with
the Transaction;
(vi) except for trade payables incurred in the Ordinary Course of
Business and amounts outstanding under existing credit facilities as of
the date of this Agreement, borrow monies for any reason or draw down on
any line of credit or debt obligation, or become the guarantor, surety,
endorser or otherwise liable for any debt, obligation or liability
(contingent or otherwise) of any other Person; provided that the Purchased
Companies and their Subsidiaries may borrow or draw down under existing
credit facilities so long as the aggregate principal amount outstanding
thereunder as of the Effective Time does not exceed the amount outstanding
thereunder as of the date of this Agreement;
(vii) subject to any Lien (except for Permitted Exceptions and
leases that do not materially impair the use of the property subject
thereto in their respective businesses as presently conducted), any of the
properties or assets (whether tangible or intangible) of the Company, the
Purchased Companies or any of their Subsidiaries;
39
(viii) acquire any material properties or assets or sell, assign,
transfer, convey, lease or otherwise dispose of any of the material
properties or assets of the Company, the Purchased Companies and their
Subsidiaries except sales of products to customers in the Ordinary Course
of Business; provided, however, that the Company may sell, transfer or
convey its shares of capital stock of Metron Technology (Hong Kong)
Limited, Metron Technology (Far East) Limited or Metron Technology
(Nordic) AB to one or more Purchased Companies or Subsidiaries selected in
consultation with the Purchaser (it being understood that, effective upon
such sale, assignment, transfer or conveyance, the entity whose shares
have been sold, assigned, transferred or conveyed shall be deemed, for
purposes of this Agreement, to be a "Subsidiary" and not a "Purchased
Company").
(ix) cancel or compromise any debt or claim or waive or release any
material right of the Company, the Purchased Companies or any of their
Subsidiaries except pursuant to existing Contracts listed in Schedule
6.2(b)(ix);
(x) enter into any commitment for capital expenditures of the
Company, the Purchased Companies and their Subsidiaries in excess of
$25,000 for any individual commitment and $250,000 per quarter for all
commitments in the aggregate;
(xi) enter into, modify or terminate any labor or collective
bargaining agreement of the Company, the Purchased Companies or any of
their Subsidiaries or, through negotiation or otherwise, make any
commitment or incur any liability to any labor organization with respect
to the Company, the Purchased Companies or any of their Subsidiaries;
(xii) introduce any material change with respect to the operation of
the Company, the Purchased Companies or any of their Subsidiaries,
including any material change in the types, nature, composition or quality
of its products or services, take any action to cause any material change
in any contribution of its product or service lines to its revenues or net
income, or, other than in the Ordinary Course of Business, make any change
in product specifications or prices or terms of distributions of such
products;
(xiii) permit the Company, the Purchased Companies or any of their
Subsidiaries to enter into any transaction or to make or enter into any
Contract which by reason of its size, nature or otherwise is not in the
Ordinary Course of Business;
(xiv) permit the Company, the Purchased Companies or any of their
Subsidiaries to enter into or agree to enter into any merger or
consolidation with, any corporation or other entity, or engage in any new
business or invest in, make a loan, advance or capital contribution to, or
otherwise acquire the securities of any other Person;
(xv) enter into any Contract or transaction between the Company on
one hand and any Purchased Company or their Subsidiaries on the other
hand;
(xvi) (A) make or rescind any election relating to Taxes, settle or
compromise any claim, action, suit, litigation, proceeding, arbitration,
investigation, audit controversy relating to Taxes or (B) except as
required by applicable law or GAAP, make any change to any of its Tax or
reporting or accounting practices, methods or policies;
40
(xvii) enter into any contract or agreement or commitment which
restrains, restricts, limits or impedes the ability of the Company, the
Purchased Companies or any of their Subsidiaries to compete with or
conduct any business or line of business in any geographic area;
(xviii) change its fiscal year, revalue any of its assets or except
as required under GAAP or applicable Law, make any changes in financial
accounting methods, principles or practices except as required by GAAP or
by a Governmental Body and as concurred to by the Company's independent
public accountants;
(xix) commence or settle any Legal Proceeding;
(xx) enter into any Contract that if in effect as of the date
hereof would be a Material Contract, other than Contracts of the type set
forth on Schedule 6.2(b)(xx); or
(xxi) agree to do anything prohibited by this Section 6.2 or
anything which would reasonably be expected to result in the condition set
forth in Section 7.2(a) not being satisfied.
6.3 Consents.
(a) Subject to Section 6.19, the Company shall use its commercially
reasonable efforts, and the Purchaser shall cooperate with the Company, to
obtain at the earliest practicable date all consents and approvals required to
consummate the transactions contemplated by this Agreement, including, without
limitation, the consents and approvals referred to in Section 4.6(b) and any
consents or approval required for the transfer of the Contracts set forth on
Schedule 1.1(c).
(b) If any required consent to the assignment of any Contract to
which the Company is a party is not obtained as of the Closing, such Contract
shall be an Excluded Asset and shall not be assigned to the Purchaser; provided,
however, if any such consent is not obtained prior to the Closing, the Company
and the Purchaser shall, subject to Section 6.19, cooperate with each other as
reasonably requested by the other party during the period between the Closing
Date and the date upon which the Company may file its final Tax Return as
contemplated by Section 6.20 (the "Dissolution Period") in order to obtain, at
the expense of the Purchaser, the required consent to assignment. If such
consent is obtained following the Closing, such Contract shall become a
Purchased Contract as of the date such consent is obtained and shall be deemed
to be included on Annex A to the Assignment and Assumption Agreement and the
Purchaser shall promptly provide the Company with a copy of the Assignment and
Assumption Agreement and the annex thereto evidencing such inclusion.
6.4 Filings with Governmental Bodies.
(a) Each of the Purchaser and the Company shall (a) make or cause
to be made all filings required of them or any of their respective Subsidiaries
or Affiliates under the HSR Act or other Antitrust Laws with respect to the
transactions contemplated hereby as promptly as practicable and, in any event,
within ten (10) Business Days after the date of this Agreement in the case of
all filings required under the HSR Act and within fifteen (15) Business
41
Days in the case of all other filings required by other Antitrust Laws, (b)
comply at the earliest practicable date with any request under the HSR Act or
other Antitrust Laws for additional information, documents, or other materials
received by each of them or any of their respective Subsidiaries from the
Federal Trade Commission, the Antitrust Division or any other Governmental Body
in respect of such filings or such transactions, and (c) cooperate with each
other in connection with any such filing (including, to the extent permitted by
applicable law, providing copies of drafts filings to the non-filing parties
prior to filing and considering all reasonable additions, deletions or changes
suggested in connection therewith) and in connection with resolving any
investigation or other inquiry of any of the Federal Trade Commission, the
Antitrust Division or other Governmental Body under any Antitrust Laws with
respect to any such filing or any such transaction. Each such party shall use
commercially reasonable efforts to furnish to each other all information
required for any application or other filing to be made pursuant to any
applicable law in connection with the transactions contemplated by this
Agreement. Each such party shall promptly inform the other parties hereto of any
oral communication with, and provide copies of written communications with, any
Governmental Body regarding any such filings related to the transaction
contemplated by this Agreement. No party hereto shall independently participate
in any formal meeting with any Governmental Body in respect of any such filings,
investigation, or other inquiry related to the transactions contemplated by this
Agreement without giving the other parties hereto prior notice of the meeting
and, to the extent permitted by such Governmental Body, the opportunity to
attend and/or participate. Subject to applicable law, the parties hereto will
consult and cooperate with one another in connection with any analyses,
appearances, presentations, memoranda, briefs, arguments, opinions and proposals
made or submitted by or on behalf of any party hereto under the HSR Act or other
Antitrust Laws. The Company and Purchaser may, as each deems advisable and
necessary, reasonably designate any competitively sensitive material provided to
the other under this Section 6.4 as "outside counsel only." Such materials and
the information contained therein shall be given only to the outside legal
counsel of the recipient and will not be disclosed by such outside counsel to
employees, officers, or directors of the recipient, unless express written
permission is obtained in advance from the source of the materials (the Company
or Purchaser, as the case may be).
(b) Each of Purchaser and the Company shall use commercially
reasonable efforts to resolve such objections, if any, as may be asserted by any
Governmental Body with respect to the transactions contemplated by this
Agreement under the HSR Act, the ▇▇▇▇▇▇▇ Act, as amended, the ▇▇▇▇▇▇▇ Act, as
amended, the Federal Trade Commission Act, as amended, and any other United
States federal or state or foreign statutes, rules, regulations, orders,
decrees, administrative or judicial doctrines or other laws that are designed to
prohibit, restrict or regulate competition, mergers or actions having the
purpose or effect of monopolization or restraint of trade or significant
impediment to effective competition or the creation or strengthening of a
dominant position (collectively, the "Antitrust Laws"). Each of Purchaser and
the Company shall use commercially reasonable efforts to take such action as may
be required to cause the expiration of the notice periods under the HSR Act or
other Antitrust Laws with respect to such transactions as promptly as possible
after the execution of this Agreement. Notwithstanding anything to the contrary
in this Agreement, neither Purchaser or any of its Affiliates nor the Company
shall be required (i) to hold separate (including by trust or otherwise) or
divest any of their respective businesses product lines or assets, (ii) to agree
to any limitation on the operation or conduct of their respective businesses,
(iii) to waive any of the conditions set forth in Article
42
VII of this Agreement or (iv) to contest any Legal Proceedings relating to the
transactions contemplated by this Agreement.
6.5 Other Actions.
(a) The Company and the Purchaser shall use their commercially
reasonable efforts to (i) take all actions necessary or appropriate to
consummate the transactions contemplated by this Agreement and (ii) cause the
fulfillment at the earliest practicable date of all of the conditions to their
respective obligations to consummate the transactions contemplated by this
Agreement.
(b) From time to time following the Closing, the Company and
Purchaser shall, and shall cause their respective Affiliates to, execute,
acknowledge and deliver all such further conveyances, notices, assumptions,
releases and acquaintances and such other instruments, and shall take such
further actions, as may be necessary or appropriate to assure fully to Purchaser
and its respective successors or assigns, all of the properties, rights, titles,
interests, estates, remedies, powers and privileges intended to be conveyed to
Purchaser, and to assure fully to the Company and its successors and assigns,
the assumption by the Purchaser of the Assumed Liabilities, under this Agreement
and the transactions contemplated hereby.
6.6 Non Negotiation; Non-Solicitation.
(a) The Company shall not, nor shall it authorize or permit any of
its Subsidiaries, any of their respective directors, officers or employees or
any investment banker, financial advisor, attorney, accountant or other advisor,
agent or representative (collectively, "Representatives") retained by it or any
of its Subsidiaries to, directly or indirectly through another person, (i)
solicit, initiate or knowingly encourage, or take any other action intended to,
or which would reasonably be expected to, facilitate, any inquiries or the
making of any proposal that constitutes or is reasonably likely to lead to a
Company Takeover Proposal or (ii) participate in any discussions or negotiations
regarding, or furnish to any person any information, or otherwise cooperate in
any way with, any Company Takeover Proposal. Without limiting the foregoing, it
is agreed that any violation of the restrictions set forth in the preceding
sentence by any Representative of the Company or any of its Subsidiaries shall
be a breach of this Section 6.6(a) by the Company. The Company shall, and shall
cause its Subsidiaries to, immediately cease and cause to be terminated all
existing discussions or negotiations with any person conducted heretofore with
respect to any Company Takeover Proposal and request the prompt return or
destruction of all confidential information previously furnished.
Notwithstanding the foregoing, at any time prior to obtaining the Company
Shareholder Approval, in response to a bona fide written Company Takeover
Proposal that the Company Boards determine in good faith (after consultation
with outside legal counsel and a financial advisor of nationally recognized
reputation) constitutes or is reasonably likely to result in a Company Superior
Proposal, and which Company Takeover Proposal was unsolicited and made after the
date hereof and did not otherwise result from a breach of this Section 6.6(a),
the Company may, if its Supervisory Board determines in good faith (after
consultation with outside legal counsel) that it is necessary to do so in order
to comply with its fiduciary duties to the shareholders, employees and other
stakeholders of the Company under applicable Law, and subject to compliance with
Section 6.6(c) and after giving Purchaser written notice of such determination,
(A) furnish information
43
with respect to the Company and its Subsidiaries to the person making such
Company Takeover Proposal (and its Representatives) pursuant to a customary
confidentiality agreement not less restrictive of such person than the
Confidentiality Agreement, provided that all such information is provided to
Purchaser prior to or substantially concurrent with the time it is provided to
such person, and (B) participate in discussions or negotiations with the person
making such Company Takeover Proposal (and its Representatives) regarding such
Company Takeover Proposal.
For purposes of this Agreement, "Company Takeover Proposal" shall
mean any, inquiry, proposal or offer from any Person for (a) a merger,
consolidation, dissolution, recapitalization or other business combination
involving the Company, (b) the issuance of twenty percent (20%) or more of the
equity securities of the Company as consideration for the assets or securities
of another Person or (c) the purchase or acquisition in any manner, directly or
indirectly, twenty percent (20%) or more of the equity securities of the Company
or assets (including equity securities of any Subsidiary of the Company) that
represent twenty percent (20%) or more of the total consolidated assets of the
Company, in each case other than the transactions contemplated by this
Agreement.
For purposes of this Agreement, "Company Superior Proposal" shall
mean any bona fide offer made by a third party that if consummated would result
in such Person (or its shareholders) owning, directly or indirectly, all or
substantially all of the shares of Company Common Stock then outstanding (or of
the surviving entity in a merger or the direct or indirect parent of the
surviving entity in a merger) or all or substantially all of the total
consolidated assets of the Company, which the Supervisory Board of the Company
determines in good faith (after consultation with a financial advisor of
nationally recognized reputation) to be (i) more favorable to the shareholders
of the Company from a financial point of view than the Transaction (taking into
account all the terms and conditions of such proposal and this Agreement
(including any changes to the financial terms of this Agreement proposed by
Purchaser in response to such offer or otherwise)) and (ii) reasonably capable
of being completed, taking into account all financial, legal, regulatory and
other aspects of such proposal.
(b) Neither the Company Boards nor any committee thereof shall (i)
(A) withdraw (or modify in a manner adverse to Purchaser), or propose to
withdraw (or modify in a manner adverse to Purchaser), the approval,
recommendation or declaration of advisability by such Company Boards or any such
committee thereof of this Agreement or the Transaction or (B) recommend, adopt
or approve, or propose publicly to recommend, adopt or approve, any Company
Takeover Proposal (any action described in this clause (i) being referred to as
a "Company Adverse Recommendation Change") or (ii) approve or recommend, or
propose to approve or recommend, or allow the Company or any of its Subsidiaries
to execute or enter into, any letter of intent, memorandum of understanding,
agreement in principle, merger agreement, acquisition agreement, option
agreement, joint venture agreement, partnership agreement or other similar
agreement constituting or related to, or that is intended to or is reasonably
likely to lead to, any Company Takeover Proposal (other than a confidentiality
agreement pursuant to Section 6.6(a)). Notwithstanding the foregoing, each of
the Company Boards may make a Company Adverse Recommendation Change (i) if such
Company Board determines in good faith (after consultation with outside legal
counsel) that it is necessary to do so in order to comply with its fiduciary
duties to the shareholders, employees or other stakeholders of the Company under
applicable Law and (ii) the Company has complied with all other provisions of
44
this Section 6.6; provided, however, that no Company Adverse Recommendation
Change may be made until after the fifth (5) business day following Purchaser's
receipt of written notice from the Company (an "Adverse Recommendation Notice")
advising Purchaser that the Company Boards intends to make such Company Adverse
Recommendation Change and specifying the terms and conditions of such Company
Superior Proposal, if any (it being understood and agreed that any amendment to
the financial terms or other material terms of any Company Superior Proposal
shall require a new Adverse Recommendation Notice and a new five (5) business
day period). In determining whether to make a Company Adverse Recommendation
Change in response to a Company Superior Proposal, the Company Boards shall take
into account any changes to the terms of this Agreement proposed by Purchaser in
response to an Adverse Recommendation Notice or otherwise.
(c) In addition to the obligations of the Company set forth in
paragraphs (a) and (b) of this Section 6.6, the Company shall promptly (but in
any event within 24 hours or receipt thereof) advise Purchaser orally and in
writing of any Company Takeover Proposal or request for information that would
reasonably be expected to lead to or contemplates any Company Takeover Proposal,
or any inquiry that would reasonably be expected to lead to any Company Takeover
Proposal, the terms and conditions of any such request, Company Takeover
Proposal or inquiry (including any changes thereto) and the identity of the
person making any such request, Company Takeover Proposal or inquiry, with a
copy of any written Company Takeover Proposal or inquiry. The Company shall (i)
keep Purchaser informed of the status and details (including any change to the
terms thereof) of any such request, Company Takeover Proposal or inquiry and
(ii) provide to Purchaser as soon as practicable after receipt or delivery
thereof with copies of all correspondence and other written material sent or
provided to the Company or any of its Subsidiaries from any person that
describes any of the terms or conditions of any such request, Company Takeover
Proposal or inquiry.
(d) Nothing contained in this Section 6.6 shall prohibit the
Company from (i) taking and disclosing to its shareholders a position
contemplated by Rule 14e-2(a) or Item 1012(a) of Regulation M-A promulgated
under the Exchange Act or (ii) making any required disclosure to the
shareholders of the Company if, in the good faith judgment of the Company Boards
(after consultation with outside legal counsel), failure to so disclose would
constitute a violation of its fiduciary duties or applicable Law; provided,
however, that in no event shall the Company or its Company Boards or any
committee thereof take, or agree or resolve to take, any action prohibited by
Section 6.6(b).
6.7 Publicity. None of the Company, the Purchased Companies or any
of their Subsidiaries or the Purchaser shall issue any press release or public
announcement concerning this Agreement or the transactions contemplated hereby
(except in connection with press releases or public announcements to be issued
with respect to actions permitted to be taken by the Company or the Company
Boards in accordance with Section 6.6) without obtaining the prior written
approval of the other party hereto, which approval will not be unreasonably
withheld or delayed, unless, in the sole judgment of the Purchaser or the
Company, disclosure is otherwise required by applicable Law or by the applicable
rules of the Nasdaq National Market or the Company, provided that, to the extent
required by applicable law, the party intending to make such release shall use
its commercially reasonable efforts consistent with such applicable Law to
45
consult with the other party with respect to the text thereof; and provided,
further, however, that each of the Purchaser and the Company may make public
statements in response to specific questions by the press, analysts, investors
or those attending industry conferences or financial analyst conference calls,
so long as any such statements are consistent with previous press releases,
public disclosures or public statements made jointly by Purchaser and the
Company or previously approved by the Purchaser or the Company, as applicable
pursuant to this Section 6.7 and do not disclose additional information beyond
that contained in such previous joint or approved communications.
6.8 Company Stock Options and Other Awards. Purchaser shall not
assume any options or other awards under the Company Stock Plans or the ESPP or
any other option, warrant or other convertible security of the Company, the
Purchased Companies or their Subsidiaries. The Company shall fully accelerate
the vesting of all options and other awards under the Company Stock Plans at or
prior to the Effective Time. Following the Closing, the Company shall take all
actions necessary to ensure that outstanding options under the Company Stock
Plans are cancelled in exchange for payments of cash by the Company to the
holders equal to the positive difference (if any) between the value of the
underlying Company Common Stock and the exercise price of such options, less
applicable tax withholding.
6.9 Use of Name. The company hereby agrees that upon the
consummation of the transactions contemplated hereby, the Purchaser, the
Purchased Companies and their Subsidiaries shall have the sole right to the use
of the names set forth on Schedule 6.9, and the Company shall not, and shall not
cause or permit any Affiliate to, use such names or any variation or simulation
thereof; provided, however, the Company make reference to the former name of the
Company in connection with the liquidation and winding up of the Company. On or
prior to the Closing Date, the Company shall effect a change in its name to such
other name that is not similar or susceptible to confusion with Metron
Technology N.V.
6.10 Environmental Matters.
(a) The Company shall permit, and the Company shall cause the
Purchased Companies and their Subsidiaries to permit, Purchaser and Purchaser's
environmental consultant, to conduct, at the sole expense of the Purchaser, such
investigations (including investigations known as "Phase I" environmental Site
Assessments) of the environmental conditions of any of the company Properties
and the operations conducted there at (subject to any limitations contained in
valid, previously executed leases) as Purchaser, in its sole discretion, shall
deem necessary or prudent ("Purchaser's Environmental Assessments"). Purchaser's
Environmental Assessment shall be conducted by a qualified environmental
consulting firm, possessing reasonable levels of insurance, in compliance with
applicable laws and in a manner that minimizes the disruption of the operations
of the Company, the Purchased Companies and their Subsidiaries, as the case may
be.
6.11 Employee Bonus Incentive Plan. Prior to the Closing Date,
Purchaser shall adopt the employee bonus incentive plan (the "Employee Bonus
Incentive Plan") in substantially the form attached hereto as Exhibit C;
provided, however, (i) that the financial provisions of such Employee Bonus
Incentive Plan related to the persons identified on Schedule 7.2(i) and Schedule
7.2(k) (collectively, the "Key Employees") may not be changed between the
46
date of this Agreement and the Effective Time, (ii) the offer letters presented
to the Key Employees prior to the date of this Agreement shall not be amended or
modified without the consent of the respective Key Employee and (iii) that the
non- financial provisions of such Employee Bonus Incentive Plan related to the
Key Employees may not be changed in any material respect between the date of
this Agreement and the Effective Time. No later than five business days prior to
the Closing Date, the Company shall provide Purchaser the proposal required by
the terms of the Employee Bonus Incentive Plan.
6.12 Updated Schedules. The Company Disclosure Schedule shall be
updated by the Company, as provided in this Section 6.12, and delivered to the
Purchaser at the Closing (collectively, the "Updated Schedules"). The Updated
Schedules shall be updated as of the Closing Date to reflect changes occurring
between the date hereof and the Closing Date to the information set forth in
response to the corresponding representations and warranties; provided, that, no
such changes or Updated Schedules shall affect the representations and
warranties (and corresponding Schedules) made as of the date hereof.
6.13 Preparation of the Company Proxy Statement; Shareholders
Meeting.
(a) As soon as practicable following the date of this Agreement, (i)
the Company shall prepare and file with the SEC the Company Proxy Statement and
(ii) Purchaser shall promptly provide to the Company any information required
for inclusion in the Company Proxy Statement and shall promptly provide such
other information or assistance in the preparation thereof as may be reasonably
requested by the Company. The Company shall use its commercially reasonable
efforts to respond as promptly as practicable to any comments of the SEC with
respect thereto and to cause the Company Proxy Statement to be mailed to the
shareholders of the Company as promptly as practicable after the date of this
Agreement. The Company shall promptly notify Purchaser upon the receipt of any
comments from the SEC or its staff or any request from the SEC or its staff for
amendments or supplements to the Company Proxy Statement and shall provide
Purchaser with copies of all correspondence between the Company and its
Representatives, on the one hand, and the SEC and its staff, on the other hand.
In the event that the Company receives any comments from the SEC or its staff or
any request from the SEC or its staff for amendments or supplements to the
Company Proxy Statement, Purchaser shall promptly provide to the Company, upon
receipt of notice from the Company, any information required for inclusion in
the response of the Company to such comments or such request and shall promptly
provide such other information or assistance in the preparation thereof as may
be reasonably requested by the Company. Notwithstanding the foregoing, prior to
filing or mailing the Company Proxy Statement (or any amendment or supplement
thereto) or responding to any comments of the SEC with respect thereto, the
Company shall provide Purchaser an opportunity to review and comment on such
document or response. If at any time prior to the Effective Time any information
relating to the Company or any of its respective Affiliates, directors or
officers, should be discovered by the Company which should be set forth in an
amendment or supplement to the Company Proxy Statement, so that such document
would not include any misstatement of a material fact or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, the Company shall
promptly notify the Purchaser and an appropriate amendment or supplement
describing such information shall be promptly filed with the SEC and, to the
extent required by Law, disseminated to the shareholders of the Company.
47
(b) The Company shall, as soon as practicable following the date of
this Agreement, duly call, give notice of, convene and hold a meeting of its
shareholders (the "Company Shareholders Meeting") solely for the purpose of
obtaining the Company Shareholder Approval and any other matter to facilitate
the Transaction and the other transactions contemplated hereby and those matters
set forth on Schedule 6.13(b). Subject to Section 6.6(b), the Company shall,
through its Company Boards, recommend to its shareholders approval of the
Transaction. Without limiting the generality of the foregoing, the Company's
obligations pursuant to the first sentence of this Section 6.13(b) shall not be
affected by (i) the commencement, public proposal, public disclosure or
communication to the Company of any Company Takeover Proposal or (ii) the
withdrawal or modification by the Supervisory Board of the Company or any
committee thereof of such Supervisory Board or such committee's approval or
recommendation of this Agreement or the Transaction.
6.14 Employee Benefits.
(a) Effective no later than the day immediately preceding the
Effective Time, the Company and its ERISA Affiliates, as applicable, shall each
terminate (i) any and all Company Plans that contain a cash or deferred
arrangement intended to qualify under Section 401(k) of the Code (the "401(k)
Plans") (unless Purchaser provides written notice to the Company that such
401(k) Plans shall not be terminated at least five days prior to the Closing
Date) and (ii) any and all group severance, retention, separation or salary
continuation plans, programs or arrangements (collectively, "Terminated Company
Plans"). Unless Purchaser provides written notice to the Company otherwise, no
later than five (5) days prior to the Closing Date, the Company shall provide
Purchaser with evidence that the 401(k) Plans and the Terminated Company Plans
have been terminated (effective no later than the day immediately preceding the
Effective Time) pursuant to resolutions of the Company Boards or the board of
directors of the applicable ERISA Affiliate. The form and substance of such
resolutions shall be subject to the prior review and reasonable approval of
Purchaser. The Company and the ERISA Affiliates also shall take such other
actions in furtherance of terminating such 401(k) Plans and Terminated Company
Plans as Purchaser may reasonably require.
(b) Prior to the Effective Time, the Company, the Purchased
Companies and their Subsidiaries shall, to the extent required by applicable
Laws, notify and consult with works council in non-US jurisdictions regarding
the transactions contemplated by this Agreement and the transfer of employees of
the Company, the Purchased Companies and their Subsidiaries to Purchaser or its
subsidiaries and shall use commercially reasonable efforts, as reasonably
requested by the Purchaser, under applicable Laws to facilitate the Purchaser's
hiring of the employees of the Company, the Purchased Companies and their
Subsidiaries as of the Effective Time; provided, that such actions shall be
subject to the prior review and approval of Purchaser. Prior to the Effective
Time, none of the Company, the Purchased Companies or any of their Subsidiaries
shall make any representation to Employees regarding post-Closing employment
practices, procedures and commitments of the Purchaser, including post-Closing
employee benefit plans and compensation, without the prior written approval of
Purchaser.
(c) To the extent permitted by applicable Law and applicable Tax
qualification requirements (and subject to any generally applicable break in
service or similar rule), Purchaser shall cause the employees of the Company,
the Purchased Companies and their Subsidiaries who
48
continue employment with Parent or any of its Affiliates ("Continuing
Employees") to be credited with service for the period they were employed by the
Company, the Purchased Companies and their Subsidiaries for purposes of
eligibility and vesting under its 401(k) plan. Nothing in this Section 6.14(c)
shall be construed to entitle any Continuing Employee to continue his or her
employment with Purchaser or any of its Affiliates. To the extent permitted by
the applicable plans and subject to approval by any applicable insurance
carrier, with respect to any health plans in which employees of the Company, the
Purchased Companies and their Subsidiaries are eligible to participate after the
Effective Time, Purchaser or its affiliates shall waive all limitations as to
pre-existing conditions exclusions with respect to participation and coverage
requirements applicable to such employees (to the extent such exclusion was
waived under applicable health plans offered to such employees by the Company,
the Purchased Companies or their Subsidiaries).
6.15 Insurance. Following the Closing, to the extent permissible
under applicable policies, the Purchased Companies and their Subsidiaries shall
retain the benefit under any insurance policies, programs and arrangements
maintained by the Company under which any of the Purchased Companies are
entitled to coverage, of (a) any claims that have been made prior to the Closing
under any claims made policies, programs and arrangements, and (b) all
occurrence based policies, programs and arrangements in relation to events
occurring prior to the Effective Time. The Company shall cooperate with the
Purchaser, the Purchased Companies and their Subsidiaries in making and
collecting claims under such policies, programs and arrangements. Any moneys
paid to the Company in respect of such claims shall be promptly paid over to or
as directed by Purchaser.
6.16 Intercompany Items. Prior to or at the Closing, except as set
forth on Schedule 6.16 hereto (a) the Company shall contribute to the Purchased
Companies all cash in excess of the amount permitted to be retained pursuant to
Section 1.2(c) and (b) in manner acceptable to the Purchaser, all intercompany
arrangements, accounts and agreements between the Company and any of its
Affiliates (other than the Purchased Companies and their Subsidiaries), on the
one hand, and the Purchased Companies and their Subsidiaries, on the other hand
shall be terminated or settled, as of the Effective Time, and all obligations
thereunder shall be cancelled and released without any payment being made in
respect thereof.
6.17 Liquidation and Satisfactions of Claims.
(a) As promptly as practicable following the Closing (subject to
Section 6.20), the Company shall proceed to wind up its affairs, satisfy all
valid claims of creditors and others having claims against the Company, and
distribute any remaining assets to its shareholders, all in full compliance with
applicable Law. To the extent that any distribution is subject to withholding or
similar taxes, the Company shall withhold the required amounts from such
distributions and remit such amounts to the applicable Tax authority as required
by Law. In no event shall the Company make any distribution to its shareholders
if, after giving effect to such distribution, the Company would be insolvent or
unable to pay its debts as they come due, would have remaining liabilities in
excess of its remaining assets, or would otherwise be unable to satisfy in full
all valid claims against the Company.
49
(b) As soon as practicable after execution of this Agreement, the
Company shall use all commercially reasonable efforts to institute or continue,
as the case may be, the winding up the affairs, dissolution and liquidation as
provided for under applicable Law of each of Metron Technology (Hong Kong)
Limited, Metron Technology (Far East) Limited and Metron Technology (Nordic) AB.
6.18 Indemnification, Exculpation and Insurance.
(a) Purchaser shall, and shall cause the Purchased Companies and
their Subsidiaries to, indemnify and hold harmless, and provide advancement of
expenses to, all past and present directors, officers and employees of the
Company, the Purchased Companies and their Subsidiaries to the extent provided
by the applicable charter or other organizational documents as currently in
effect at the date hereof and as previously provided to the Purchaser or as
provided for in the Contracts set forth on Schedule 6.18(a), for acts or
omissions occurring at or prior to the Effective Time in their capacities as
such, with references to the Company thereafter deemed to refer to the
Purchaser; provided, however, that neither Purchaser nor any of the Purchased
Companies or their Subsidiaries shall have any obligation to indemnify any
individual Person under this Section 6.18 with respect to any matter
constituting (i) a breach of this Agreement or any of the Transaction Agreements
by such Person, (ii) criminal conduct by such Person, (iii) a material violation
of any national, state or foreign securities laws by such Person, (iv) bad faith
conduct or a breach of any applicable duty of loyalty by such Person, or (v) any
other matter in respect of which indemnification would not be permitted for such
Person under applicable Law.
(b) In the event that the Purchaser or any of its successors or
assigns (i) consolidates with or merges into any other Person and is not the
continuing or surviving entity of such consolidation or merger or (ii) transfers
or conveys all or substantially all of its properties and other assets to any
Person, then, and in each such case, Purchaser shall cause proper provision to
be made so that the successors and assigns of Purchaser or transferee of such
assets shall assume the obligations set forth in this Section 6.18.
(c) Notwithstanding any other provision of this Agreement to the
contrary, the indemnitees to whom this Section 6.18 applies shall be third party
beneficiaries of this Section 6.18. The provisions of this Section 6.18 are
intended to be for the benefit of each such indemnitee, his or her heirs and his
or her representatives. The obligations of Parent and the Purchased Companies
and their Subsidiaries under this Section 6.18 shall not be terminated or
modified in such a manner as to adversely affect any indemnitee to whom this
Section 6.18 applies without the express written consent of such affected
indemnitee.
6.19 Certain Contracts.
(a) With respect to Contracts to which the Company is a party
identified on Schedule 6.19(a) ("Company Contracts"), the Purchaser and the
Company shall cooperate between the date hereof and the Closing Date in order
to, at the Purchaser's election: (i) obtain any amendment to such Company
Contract as specified by the Purchaser, and/or (ii) terminate such Company
Contract on terms satisfactory to the Purchaser.
50
(b) If the Purchaser and the Company obtain all amendments to such
Company Contract, if any, requested by the Purchaser, on or prior to the Closing
Date, then such Company Contract shall constitute a Purchased Asset and shall be
assigned to the Purchaser or its designee at Closing.
(c) If all required consents to the termination of any Company
Contract that the Purchaser elects to terminate are obtained on or prior to the
Closing Date, then such Company Contract shall be terminated as of or prior to
the Effective Time, such Company Contract shall be an Excluded Asset and shall
not be assigned to the Purchaser.
(d) If either (i) any amendments to any Company Contract requested
by the Purchaser are not obtained, or (ii) any consent to termination of a
Company Contract as to which the Purchaser has requested termination are not
obtained, then (x) such Company Contract shall be an Excluded Asset and shall
not be assigned to the Purchaser.
(e) In the event any Company Contracts are excluded as Excluded
Assets pursuant to Section 6.19(d), the Company, and the Purchaser will
cooperate with each other as reasonably requested by the other party during the
Dissolution Period in order to obtain, at the expense of the Purchaser, the
required amendment or termination of any such Company Contract as contemplated
by this Section 6.19.
(f) With respect to the Contracts to identified on Schedule 6.19(f)
which a Purchased Company or a Subsidiary are parties that are not Company
Contracts, between the date hereof and the Closing Date, the Company will
cooperate with Purchaser, as requested by Purchaser, to obtain an amendment to
such Contract satisfactory to the Purchaser or to terminate such Contract on
terms satisfactory to the Purchaser. The costs and expenses of any such
amendment or termination shall be paid by the Purchaser.
(g) The Company shall use commercially reasonable efforts to, prior
to the Closing, assign such Company Contracts as Purchaser may designate as soon
as practicable following the execution of this Agreement to a Purchased Company
or a Subsidiary as may be designated by the Purchaser as soon as practicable
following the execution of this Agreement.
6.20 Agreements Regarding Certain Taxes.
(a) As soon as practicable after the execution of the Agreement,
the Company shall commence discussions with the revenue authorities of The
Netherlands for the purpose of reaching agreement on the treatment of all
material items relevant to the determination of: (i) the amount of surtax to be
imposed by The Netherlands on (x) payments made by the Company to holders of the
Company's stock options, Warrants and Convertible Securities, and (y)
distributions to the Company's shareholders (collectively the "Surtax
Liability") and (ii) the amount of dividend Tax the Company is obligated to
withhold and remit to The Netherlands from such payments and distributions (the
"Withholding Obligations"). For the avoidance of doubt, Purchaser shall be
responsible for (i) Withholding Obligations pursuant to Section 6.20 (unless
Section 6.20(g) applies) only with respect to the Initial Cash Payment, and not
with respect to the distribution of any other payment, and (ii) the Surtax
Liability pursuant to Section 6.20 (unless Section 6.20(g) applies) only with
respect to the Initial Cash and payments made to
51
the Company pursuant to this Section 6.20. The Company shall use all
commercially reasonable efforts to take any action in accordance with applicable
Law and consistent with the dissolution and liquidation of the Company within
the period described in Section 6.20(g) that would reduce the amount of the
Surtax Liability and Withholding Obligations to be paid to the Company by the
Purchaser pursuant to Section 6.20. The Purchaser shall have the right, but not
the obligation, to participate in, approve of and/or control in its sole
discretion, any such efforts by the Company to reduce the Surtax Liability and
Withholding Obligations; provided, however, that such discretion shall be
exercised in a manner consistent with the prompt dissolution and liquidation of
the Company within the period described in Section 6.20(g). In furtherance
thereof (but not as a limitation of the means to used), at the request of the
Purchaser, the Company shall (i) cause its employees and advisors to meet and
consult with the Purchaser's employees and advisors to formulate strategies for
such discussions and prepare for meetings with the revenue authorities; (ii)
provide to Purchaser, copies of all correspondence between the Company and the
revenue authorities; and (iii) invite a representative of the Purchaser to
attend and participate in meetings with the revenue authorities.
(b) The Company shall make two (2) liquidating distributions to
the Company's shareholders (the "Initial Distribution", the "Final Distribution"
and collectively, the "Shareholder Distributions"), provided no distribution
shall be made to the Company's shareholders (including, without limitation, the
holders of the Convertible Securities) unless and until the Company's
shareholders have approved the dissolution and liquidation of the Company. As
promptly as practicable after the Closing Date and prior to the Initial
Distribution, the Company (with the participation of its tax advisors) shall
prepare and submit to the Purchaser a calculation of (i) the amount of the
liquidating distribution to be paid to the shareholders of the Company in the
Initial Distribution ("Initial Purchase Price Distribution"), (ii) the estimated
amount of the Surtax Liability arising from the liquidation of the Company (the
"Initial Surtax Liability Amount") and (iii) an estimate of the aggregate amount
of the Withholding Obligations arising from the Initial Distribution. At the
request of the Purchaser, the Company shall promptly deliver to the Purchaser
copies of all calculations, work papers and other supporting data relating to
such calculations, and drafts of all Tax Returns and other filings to be made
with respect to the Taxes described in this Section 6.20. The Company shall, and
shall cause its employees, consultants and advisors (including without
limitation its tax advisors) to fully cooperate with the Purchaser and its
advisors (including Purchaser's accountants) as Purchaser may request in
connection with Purchaser's review of such calculations and draft Tax Returns.
Purchaser shall have seven (7) Business Days to review and approve or modify the
calculations provided by the Company set forth above, and will pay at the
conclusion of such seven (7) Business Day period to the Company the Initial
Surtax Liability reflected on the calculations as approved or revised by the
Purchaser.
(c) As promptly as practicable after making the Initial
Distribution, the Company shall deliver to the Purchaser calculations of the
actual amount of any previously estimated Taxes (the "Revised Calculations").
Within fifteen (15) days after the Purchaser receives the Revised Calculations,
the Purchaser shall pay to the Company an amount equal to the sum of (i) the
actual amount of the Withholding Obligations arising from the Initial Cash
Payment Distribution and (ii) the amount of the Withholding Obligation that
would arise from the Company's payment of the aggregate remaining amount of the
Initial Cash Payment to be
52
distributed to the Company's shareholders in the Final Distribution (the "Final
Purchase Price Distribution"), such amount to be calculated at the effective tax
rate of the Withholding Obligation for the Initial Distribution. The payments by
the Purchaser to the Company pursuant to the foregoing clauses (i) and (ii)
shall be in complete satisfaction of the Purchaser's obligations to pay the
Company with respect to Withholding Obligations under this Section 6.20.
(d) No less than thirty (30) days before the date of the Final
Distribution, the Company shall prepare and submit to the Purchaser a
calculation of (i) the amount of the liquidating distribution to be paid to the
shareholders of the Company in the Final Distribution, (ii) the amount of any
difference, if any, between the Initial Surtax Liability Amount and the Surtax
Liability after the Final Distribution (the "Final Surtax Liability Amount") and
(iii) an estimate of the aggregate amount of the Withholding Obligations arising
from the Final Purchase Price Distribution (the "Final Purchase Price
Distribution Withholding Obligation"). The Final Purchase Price Distribution
Withholding Obligation shall be computed as if the Final Distribution consisted
solely of the Final Purchase Price Distribution. At the request of the
Purchaser, the Company shall promptly deliver to the Purchaser copies of all
calculations, work papers and other supporting data relating to such
calculations, and drafts of all Tax Returns and other filings to be made with
respect to such Taxes. The Company shall, and shall cause its employees,
consultants and advisors (including without limitation its independent
accounting advisors) to fully cooperate with the Purchaser and its advisors
(including Purchaser's accountants) as Purchaser may request in connection with
Purchaser's review of such calculations and draft Tax Returns.
(e) Purchaser shall have seven (7) Business Days to review and
approve or modify the calculations and draft Tax Returns provided by the Company
as set forth in Section 6.20(d) above, and will pay to the Company (if the
difference reflects an additional Surtax Liability), or receive from the Company
(if the difference reflects a lesser Surtax Liability), the Final Surtax
Liability Amount reflected on the calculations as approved or revised by the
Purchaser. If the actual Final Purchase Price Distribution Withholding
Obligation is less than the amount previously paid by the Purchaser to the
Company pursuant to Section 6.20(c)(ii), the Company shall promptly pay to the
Purchaser an amount equal to such excess.
(f) The Company shall not file any Tax Returns until the Purchaser
has approved the calculations and Tax Returns in connection with Shareholder
Distributions. In accordance with the time periods prescribed by applicable Law
and as may be determined by the applicable Tax authorities, the Company shall
(A) file the appropriate Tax Returns and make the other appropriate filings with
respect to the sale of the Purchased Assets, the Shareholder Distributions and
Surtax Liability and the Withholding Obligations, as approved by the Purchaser,
and (B) pay all Taxes and other amounts shown to be due thereon. Purchaser shall
be responsible for any interest or penalties imposed on the Company with respect
to the amounts reflected on the Company's Tax Returns approved by Purchaser
other than interest and penalties on any Taxes incurred by the Company after the
Effective Time which are not Assumed Liabilities under this Agreement.
53
(g) During the six (6) month period beginning from and after the
Closing Date (the "Tax Resolution Period"), the Company shall use all
commercially reasonable efforts to obtain from the applicable Tax authorities a
full and final resolution of the (i) Surtax Liability and Withholding
Obligations described in this Section 6.20 and (ii) the Company's corporate
income tax obligations (the "Income Tax Liabilities") The Purchaser shall have
the right, but not the obligation, to participate in any discussions or
negotiations with the applicable Tax authorities regarding such Taxes and the
Purchaser shall have the right to approve, in its sole discretion, any
settlement or other agreements with regard thereto. At any time during the Tax
Resolution Period, the Purchaser shall have the right, but not the obligation,
to assume full responsibility for any negotiation and resolution of the Surtax
Liability and Withholding Obligations and the Income Tax Liabilities; provided
that in such event, the Purchaser and the Company shall enter into an assumption
agreement reasonably acceptable to the parties (and with the consent of the
applicable Tax authorities, if required) whereby the Company assigns all of its
rights (including without limitation, any right to refund), and the Purchaser
assumes all Liabilities, arising out of or related to the Surtax Liability and
Withholding Obligations and Income Tax Liabilities of the Company (a "Tax
Liability Agreement"). In the event that the Company is unable to obtain a full
and final resolution of the Surtax Liability and Withholding Obligations prior
to the end of the Tax Resolution Period, subject to the approval of the
liquidator of the Company and the applicable tax authority, the Purchaser and
the Company shall enter into a Tax Liability Agreement to be effective upon the
termination of the Tax Resolution Period. If the parties enter into a Tax
Liability Agreement, all Liabilities assumed by the Purchaser pursuant to such
agreement shall thereafter be deemed to be Assumed Liabilities. At the time of
any assumption of Liabilities or execution of any Tax Liability Agreement by
Purchaser as contemplated by this Section 6.20(e), and as a condition to
Purchaser's obligations to enter into such agreement the Company shall remit to
Purchaser cash in an amount equal to the sum of (i) the amount previously paid
by Purchaser to the Company for any Surtax Liability or Withholding Obligations
that the Company has not theretofore remitted to the applicable Tax authorities
and (ii) an amount sufficient to pay in full any Taxes incurred by the Company
after the Effective Time which are not Assumed Liabilities under this Agreement
without regard to this Section 6.20(g); provided, in the event that after a full
and final resolution is obtained from the applicable Tax authorities in
connection with such Taxes the amount remitted to Purchaser exceeds the final
amount of such Taxes, the Purchaser shall promptly pay to the Company such
excess amount. Purchaser agrees that it shall not negotiate a resolution of the
Company's Tax Liabilities by agreeing to increase the amount of Taxes referred
to in clause (ii) of the preceding sentence unless it is advised by a qualified
tax advisor mutually chosen by the Purchaser and Company that the applicable Tax
authority's demand for such payment has a reasonable likelihood of success on
the merits.
(h) If after the payment by the Company to the applicable Tax
authorities of the Surtax Liability and Withholding Obligations it appears a
refund of such payments may be obtainable, the Company shall cooperate during
the Tax Resolution Period with the Purchaser to take such actions and execute
such instruments as reasonably requested by the Purchaser to pursue and obtain
such refund. Upon the expiration of the Tax Resolution Period, the Company shall
grant to the Purchaser a power of attorney to act on its behalf to pursue any
such Tax refund claims (which may be included in a Tax Liability Agreement, if
any).
54
ARTICLE VII
CONDITIONS TO CLOSING
7.1 Conditions Precedent to Each Party's Obligations. The
respective obligations of each party to this Agreement to consummate the
transactions contemplated by this Agreement are subject to the fulfillment, on
or prior to the Closing Date, of each of the following conditions (any or all of
which may be waived by agreement of the parties, in whole or in part, to the
extent permitted by applicable law):
(a) the Company Shareholder Approval shall have been obtained;
(b) all filings required to be made shall have been made and all
waiting periods (and any extension thereof) applicable to the Transaction under
the HSR Act or any other applicable Antitrust Law shall have been terminated or
shall have expired; and
(c) there shall not be in effect any Order by a Governmental Body
of competent jurisdiction restraining, enjoining or otherwise prohibiting the
consummation of the transactions contemplated hereby.
7.2 Conditions Precedent to Obligations of Purchaser. The
obligation of the Purchaser to consummate the transactions contemplated by this
Agreement is subject to the fulfillment, on or prior to the Closing Date, of
each of the following conditions (any or all of which may be waived by the
Purchaser in whole or in part to the extent permitted by applicable law):
(a) all representations and warranties of the Company contained
herein (as modified by the Company Disclosure Schedule delivered as of the date
hereof, without giving effect to any update delivered as provided in Section
6.12) shall be true and correct, as of the Closing Date as though made on the
Closing Date (except to the extent that such representations and warranties
expressly relate to a specified earlier date, in which case such representations
and warranties shall speak as of such date) without giving effect to any
materiality or Material Adverse Effect qualifications contained therein;
provided, however, that the condition set forth in this Section 7.2(a) shall be
deemed satisfied so long as all failures of such representations and warranties
to be true and correct, individually or in the aggregate, would not reasonably
be expected to result in a Material Adverse Effect;
(b) the Company shall have performed and complied in all material
respects with all obligations and covenants required by this Agreement to be
performed or complied with by it on or prior to the Closing Date;
(c) the Purchaser shall have been furnished with certificates
(dated the Closing Date and in form and substance reasonably satisfactory to the
Purchaser) executed by the Chief Executive Officer and Chief Financial Officer
of the Company certifying as to the fulfillment of the conditions specified in
Section 7.2(a) and Section 7.2(b) hereof;
(d) [intentionally omitted]
55
(e) there shall not have been or occurred any event or condition
that would reasonably be expected to have a Material Adverse Effect;
(f) No Legal Proceeding shall be pending (or, in the case of Legal
Proceedings in which a Governmental Body is, or is threatened to become, a
party, threatened) against the Purchaser, any of the Purchased Companies or any
of their Subsidiaries, and no Legal Proceeding in which any resulting Liability
would be an Assumed Liability shall be pending (or, in the case of Legal
Proceedings in which a Governmental Body is, or is threatened to become, a
party, threatened) against the Company, that in any case seeks to restrain or
prohibit, or obtain substantial damages with respect to, the transactions
contemplated by this Agreement, in each case except for any Legal Proceeding of
the type described in clause (e) of the definition of "Material Adverse Effect";
(g) the Company shall have provided the Purchaser with
certificates issued by each Purchased Company meeting the requirements of
Treasury Regulation Section 1.1445-2(c)(3) and the Company shall have provided
proper notice to the U.S. Internal Revenue Service of the issuance of each such
certificate pursuant to Treasury Regulation Section 1.897-2(h)(2);
(h) the Purchaser shall have received the written resignations of
each director of each Purchased Company;
(i) the individuals set forth on Schedule 7.2(i) shall have
executed and delivered non-competition agreements (the "Non-Competition
Agreements"), in substantially the form attached hereto as Exhibit B, and such
agreements shall be in full force and effect;
(j) the Company shall have provided Purchaser with evidence,
reasonably satisfactory to Purchaser, as to the termination of the 401(k) Plans
and the Terminated Company Plans in accordance with Section 6.14(a);
(k) none of the individuals identified on Schedule 7.2(k) shall
have ceased to be employed by the Purchased Companies, or shall have directly
expressed an intention to terminate his employment with the Purchased Companies.
All of such individuals shall have accepted offers of employment with Purchaser
and none of such individuals shall have withdrawn or otherwise terminated or
directly expressed any intention to withdraw or otherwise terminate such
acceptances; and
(l) (i) If the Closing occurs within ninety (90) days from the
date of this Agreement, the Purchased Companies and their Subsidiaries, taken
together as a whole, shall have on the date that is five (5) days prior to the
Closing Date (the "Measurement Date") (a) a cash balance equal to or greater
than Thirteen Million Dollars ($13,000,000) (the "Initial Cash Target"), (b) a
Working Capital balance equal to or greater than Fifty Two Million Five Hundred
Thousand Dollars ($52,500,000) (the "Initial Working Capital Target"), and (c)
Debt equal to or less than Twenty Three Million Dollars ($23,000,000) (the
"Initial Debt Target"). The foregoing condition shall also be deemed satisfied
if the sum of: (1) the amount by which the Initial Cash Target exceeds the
amount of the cash balance at the Measurement Date; plus (2) the amount by which
the Initial Working Capital Target exceeds the Working Capital at the
Measurement Date;
56
plus (3) the amount by which the Debt at the Measurement Date exceeds the
Initial Debt Target does not exceed One Million Dollars ($1,000,000).
(ii) If the Closing occurs after ninety (90) but within one
hundred twenty (120) days from the date of this Agreement (a "Delayed Closing"),
the Company shall determine the amount of the cash balance, Working Capital and
Debt of the Company, the Purchased Companies and their Subsidiaries, taken
together as a whole, as of the date that is eighty five (85) days from the date
of the Agreement (the "Baseline Date").
(A) In the event of a Delayed Closing, if on the
Baseline Date, the (1) cash balance is equal to or greater than the Initial Cash
Target, (2) the Working Capital balance is equal to or greater than the Initial
Working Capital Target, and (3) Debt is equal to or less than the Initial Debt
Target, then the "New Cash Target" shall equal the Initial Cash Target, the "New
Working Capital Target" shall equal the Initial Working Capital Target and the
"New Debt Target" shall equal the Initial Debt Target.
(B) In the event of a Delayed Closing, if on the
Baseline Date, (1) the (x) cash balance is less than the Initial Cash Target,
(y) the Working Capital balance is less than the Initial Working Capital Target,
or (z) Debt is in excess of the Initial Debt Target, and (2) the amount by
which, on the Baseline Date, the sum of the amounts by which (x) the Initial
Cash Target exceeds the cash balance, (y) the Initial Working Capital Target
exceeds the Working Capital and (z) the Debt exceeds the Initial Debt Target
(the "Baseline Date Shortfall") does not exceed One Million Dollars
($1,000,000), then (i) the "New Cash Target" shall equal the lesser of (x) the
cash balance on the Baseline Date and (y) the Initial Cash Target, (ii) the "New
Working Capital Target" shall equal the lesser of (x) the Working Capital
balance on the Baseline Date and (y) the Initial Working Capital Target and
(iii) the "New Debt Target" shall equal the greater of (x) the Debt on the
Baseline Date and (y) the Initial Debt Target.
(C) In the event of a Delayed Closing, if on the
Baseline Date, (1) the (x) cash balance is less than the Initial Cash Target,
(y) the Working Capital balance is less than the Initial Working Capital Target,
or (z) Debt is in excess of the Initial Debt Target, and (2) the Baseline Date
Shortfall exceeds One Million Dollars ($1,000,000), then the "New Cash Target,"
the "New Working Capital Target" and the "New Debt Target" shall be determined
by adjusting the actual amounts of the cash balance, Working Capital balance and
Debt as of the Baseline Date by an aggregate amount of $1,000,000, pro rata in
proportion to the amount by which such actual amounts contributed to the amount
of the Baseline Date Shortfall.
(iii) In the event of a Delayed Closing, the Purchased
Companies and their Subsidiaries, taken together as a whole, shall have on the
Measurement Date, (i) a cash balance equal to or greater than the New Cash
Target, (ii) a Working Capital balance equal to or greater than the New Working
Capital Target, and (iii) Debt equal to or less than the New Debt Target. The
condition set forth in this Section 7.2(l)(iii) shall also be deemed satisfied
if the sum of (1) the amount by which the New Cash Target exceeds the amount of
the Company's cash balance at the Measurement Date, plus (2) the amount by which
the New Working Capital Target exceeds the Company's Working Capital at the
Measurement Date, plus (3) the amount by which the Company's Debt at the
Measurement Date exceeds the New Debt Target does not exceed Five Hundred
Thousand Dollars ($500,000).
57
(iv) In the event Closing occurs more than one hundred twenty
(120) days following the date of this Agreement, the conditions set forth in
this Section 7.2(l) shall not be applicable.
7.3 Conditions Precedent to Obligations of the Company. The
obligations of the Company to consummate the transactions contemplated by this
Agreement are subject to the fulfillment, prior to or on the Closing Date, of
each of the following conditions (any or all of which may be waived by the
Company, in whole or in part, to the extent permitted by applicable law):
(a) all representations and warranties of the Purchaser contained
herein shall be true and correct in all respects as of the Closing Date as
though made on the Closing Date (except to the extent that such representations
and warranties expressly relate to a specified earlier date, in which case such
representations and warranties shall speak as of such date) without giving
effect to any materiality qualification contained therein; provided, however
that the condition set forth in this Section 7.3(a) shall be deemed satisfied so
long as all failures of such representations and warranties to be true and
correct, individually, or in the aggregate, would not reasonably be expected to
have a material adverse effect on Purchaser's ability to consummate the
transactions contemplated hereby;
(b) the Purchaser shall have performed and complied in all
material respects with all obligations and covenants required by this Agreement
to be performed or complied with by Purchaser on or prior to the Closing Date;
(c) the Company shall have been furnished with certificates (dated
the Closing Date and in form and substance reasonably satisfactory to the
Company) executed by an executive officer of the Purchaser certifying as to the
fulfillment of the conditions specified in Section 7.3(a) and Section 7.3(b);
and
(d) no Legal Proceedings shall be pending (or, in the case of
Legal Proceedings in which a Governmental Body is, or is threatened to become, a
party, threatened) against the Company that would reasonably be anticipated to
(i) materially delay the post-Closing liquidation of the Company and the
distribution of its assets to its shareholders as contemplated by this
Agreement, or (ii) result in substantial damages with respect to the
consummation of the transactions contemplated by this Agreement (other than
damages that would be an Assumed Liability or that Purchaser otherwise agrees to
assume).
ARTICLE VIII
DOCUMENTS TO BE DELIVERED
8.1 Documents to be Delivered by the Company. At the Closing, the
Company shall deliver, or cause to be delivered, to the Purchaser the following:
(a) either (i) stock certificates representing the Shares and
Third Party Shares, duly endorsed in blank or accompanied by stock transfer
powers or (ii) transfer documents in a form agreed to by the parties and in
accordance with applicable Law evidencing the irrevocable
58
transfer of the Shares by the applicable transferor and Third Party Shares
pursuant to this Agreement;
(b) the certificate referred to in Section 7.2(c);
(c) the written resignations of each of the directors of each
Purchased Company;
(d) the certificates referred to in Section 7.2(g);
(e) certificates of good standing with respect to each Purchased
Company that is organized under the Laws of a State within the United States;
(f) an Assignment and Assumption Agreement, in the form attached
hereto as Exhibit D (the "Assignment and Assumption Agreement"); and
(g) agreements between the Company and the Purchaser evidencing
the transfer of any Company Intellectual Property transferred pursuant to this
Agreement, in forms reasonably satisfactory to the Purchaser.
8.2 Documents to be Delivered by the Purchaser. At the Closing,
the Purchaser shall deliver to the Company the following:
(a) evidence of the wire transfer referred to in Section 2.2(a)
hereof;
(b) the certificate referred to in Section 7.3(c) hereof;
(c) the Employee Bonus Incentive Plan;
(d) the Assignment and Assumption Agreement; and
(e) an Indemnity Agreement, in the form attached hereto as Exhibit
E (the "Indemnity Agreement").
ARTICLE IX
MISCELLANEOUS
9.1 Certain Definitions.
(a) For purposes of this Agreement, the following terms shall have
the meanings specified in this Section 9.1:
"401(k) Plans" shall have the meaning ascribed to such term in
Section 6.14(a) hereof.
59
"Adverse Recommendation Notice" shall have the meaning ascribed to
such term in Section 6.6(b) hereof.
"Affiliate" means, with respect to any Person, any other Person
that, directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person, and the term
"control" (including the terms "controlled by" and "under common control with")
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through
owners of voting securities, by contract or otherwise.
"Antitrust Laws" shall have the meaning ascribed to such term in
Section 6.4(b) hereof.
"Asset Acquisition Statement" shall have the meaning ascribed to
such term in Section 1.5 hereof.
"Assignment and Assumption Agreement" shall have the meaning
ascribed to such term in Section 8.1(f) hereof.
"Assumed Liabilities" shall have the meaning ascribed to such term
in Section 1.3 hereof.
"Balance Sheet" shall have the meaning ascribed to such term in
Section 4.8(e) hereof.
"Balance Sheet Date" shall have the meaning ascribed to such term in
Section 4.8(e) hereof.
"Business" shall have the meaning ascribed to such term in Recital A
hereof.
"Business Day" means any day of the year on which national banking
institutions in New York are open to the public for conducting business and are
not required or authorized to close.
"Closing Date" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"COBRA" shall have the meaning ascribed to such term in Section
4.16(n) hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Company Adverse Recommendation Change" shall have the meaning
ascribed to such term in Section 6.6(b) hereof.
"Company Boards" shall have the meaning ascribed to such term in
Recital C hereof.
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"Company Common Stock" shall have the meaning ascribed to such term
in Section 4.3(a) hereof.
"Company Contracts" shall have the meaning ascribed to such term in
Section 6.19(a) hereof.
"Company Plans" shall have the meaning ascribed to such term in
Section 4.16(a) hereof.
"Company Preferred Stock" shall have the meaning ascribed to such
term in Section 4.3(a) hereof.
"Company Property" shall have the meaning ascribed to such term in
Section 4.12(a) hereof.
"Company Proxy Statement" shall have the meaning ascribed to such
term in Section 4.6(b) hereof.
"Company SEC Documents" shall have the meaning ascribed to such term
in Section 4.8(a) hereof.
"Company Shareholder Approval" shall have the meaning ascribed to
such term in Section 4.26 hereof.
"Company Shareholders Meeting" shall have the meaning ascribed to
such term in Section 6.13(b) hereof.
"Company Stock Plans" shall have the meaning ascribed to such term
in Section 4.3(a) hereof.
"Company Superior Proposal" shall have the meaning ascribed to such
term in Section 6.6(a) hereof.
"Company Takeover Proposal" shall have the meaning ascribed to such
term in Section 6.6(a) hereof.
"Confidentiality Agreement" shall have the meaning ascribed to such
term in Section 6.1(c) hereof.
"Continuing Employees" shall have the meaning ascribed to such term
in Section 6.14(c) hereof.
"Contract" means any contract, agreement, indenture, note, bond,
loan, license, instrument, lease, commitment or other binding arrangement,
whether oral or written.
"Convertible Securities" shall have the meaning ascribed to such
term in Section 4.3(a) hereof.
61
"Debt" means the aggregate amount of all borrowings and
Indebtedness, including without limitation all notes, bonds, debentures (other
than the Convertible Securities), finance leases, capitalized leases,
obligations under reimbursement agreements with respect to letters of credit and
the deferred purchase price of any property (other than trade payables in the
Ordinary Course of Business).
"Director Option Plan" shall have the meaning ascribed to such term
in Section 4.3(a) hereof.
"Dissolution Period" shall have the meaning set forth in Section
6.3(b) hereof.
"Documents" shall mean all files, documents, instruments, papers,
books, reports, records, tapes, microfilms, photographs, letters, budgets,
forecasts, ledgers, journals, title policies, customer lists, regulatory
filings, operating data and plans, technical documentation (design
specifications, functional requirements, operating instructions, logic manuals,
flow charts, etc), user documentation (installation guides, user manuals,
training materials, release notes, working papers, etc.), marketing
documentation (sales brochures, flyers, pamphlets, web pages, etc.), and other
similar materials related to the Business and the Purchased Assets in each case
whether or not in electronic form; provided however, the following shall not be
included as Documents: Company Stock Plans, ESPP, Convertible Securities ,
Warrants, 401(k) Plans and the Terminated Company Plans.
"Effective Time" shall have the meaning ascribed to such term in
Section 2.2(b) hereof.
"Employee Bonus Incentive Plan" shall have the meaning ascribed to
such term in Section 6.11 hereof.
"Employee Option Plan" shall have the meaning ascribed to such term
in Section 4.3(a) hereof.
"Employee" shall have the meaning ascribed to such term in Section
4.16(a) hereof.
"Environmental Costs and Liabilities" means, with respect to any
Person, all liabilities, obligations, responsibilities, Remedial Actions,
losses, damages, punitive damages, consequential damages, treble damages, costs
and expenses (including all reasonable fees, disbursements and expenses of
counsel, experts and consultants and costs of investigation and feasibility
studies), fines, penalties, sanctions and interest incurred as a result of any
claim or demand by any other Person or in response to any violation of
Environmental Law, whether known or unknown, accrued or contingent, whether
based in contract, tort, implied or express warranty, strict liability, criminal
or civil statute, to the extent based upon, related to, or arising under or
pursuant to any Environmental Law, Environmental Permit, order or agreement with
any Governmental Authority or other Person, which relates to any environmental,
health or safety condition, violation of Environmental Law or a Release or
threatened Release of Hazardous Materials.
62
"Environmental Law" means any foreign, federal, state or local
statute, regulation, ordinance, rule of common law or other legal requirement,
as now or hereafter in effect, in any way relating to the protection of human
health and safety, the environment or natural resources including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C. Section 9601 et seq.), the Hazardous Materials Transportation Act
(49 U.S.C. App. Section 1801 et seq.), the Resource Conservation and Recovery
Act (42 U.S.C. Section 6901 et seq.), the Clean Water Act (33 U.S.C. Section
1251 et seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.) the Toxic
Substances Control Act (15 U.S.C. Section 2601 et seq.), the Federal
Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. Section 136 et seq.), and
the Occupational Safety and Health Act (29 U.S.C. Section 651 et seq.), as each
has been or may be amended and the regulations promulgated pursuant thereto.
"Environmental Permits" shall have the meaning ascribed to such term
in Section 4.20(a) hereof.
"ERISA" shall have the meaning ascribed to such term in Section
4.16(a) hereof.
"ERISA Affiliate" shall mean any Person that is or has ever been
under common control, or that is or has ever been treated as a single employer,
with the Company, the Purchased Companies or any of their Subsidiaries under
Section 414(b), (c), (m) or (o) of the Code and the regulations issued
thereunder.
"ESPP" shall have the meaning ascribed to such term in Section
4.3(a) hereof.
"Exchange Act" shall have the meaning ascribed to such term in
Section 4.6(b) hereof.
"Excluded Assets" shall have the meaning ascribed to such term in
Section 1.2 hereof.
"Excluded Liabilities" shall have the meaning ascribed to such term
in Section 1.4 hereof.
"Final Distribution" shall have the meaning ascribed to such term in
Section 6.20(b) hereof.
"Final Purchase Price Distribution" shall have the meaning ascribed
to such term in Section 6.20(c) hereof.
"Final Purchase Price Distribution Withholding Amount" shall have
the meaning ascribed to such term in Section 6.20(d) hereof.
"Final Surtax Liability Amount" shall have the meaning ascribed to
such term in Section 6.20(d) hereof.
"GAAP" means generally accepted United States accounting principles
as of the date hereof.
63
"Governmental Body" means any government or governmental or
regulatory body thereof, or political subdivision thereof, whether federal,
state, local or foreign, or any agency, instrumentality or authority thereof, or
any court or arbitrator (public or private).
"Hazardous Material" means any substance, material or waste that is
regulated, classified, or otherwise characterized under or pursuant to any
Environmental Law as "hazardous," "toxic," "pollutant," "contaminant,"
"radioactive," or words of similar meaning or effect, including without
limitation, petroleum and its by-products, asbestos, polychlorinated biphenyls,
radon, mold, urea formaldehyde insulation.
"HSR Act" shall have the meaning ascribed to such term in Section
4.6(b) hereof.
"Income Tax Liabilities" shall have the meaning ascribed to such
term in Section 6.20(g) hereof.
"Indebtedness" means, with respect to any Person, all obligations of
such Person (a) for borrowed money, (b) evidenced by notes, bonds, debentures or
similar instruments, (c) for the deferred purchase price of goods or services
(other than trade payables or accruals incurred in the Ordinary Course of
Business), (d) under capital leases, and (e) in the nature of a guarantee of any
of the obligations described in clauses (a) through (d) above of any other
Person.
"Indemnity Agreement" shall have the meaning ascribed to such term
in Section 8.2(e) hereof.
"Initial Cash Payment" shall have the meaning ascribed to such term
in Section 2.1 hereof.
"Initial Distribution" shall have the meaning ascribed to such term
in Section 6.20(b) hereof.
"Initial Outside Date" shall have the meaning ascribed to such term
in Section 3.2(b)(i) hereof.
"Initial Purchase Price Distribution" shall have the meaning
ascribed to such term in Section 6.20(b) hereof.
"Initial Surtax Liability Amount" shall have the meaning ascribed to
such term in Section 6.20(b) hereof.
"IRS" shall mean the United States Internal Revenue Service.
"Key Employees" shall have the meaning ascribed to such term in
Section 6.11.
"Knowledge" or "Knowing" means with respect to the Company, the
actual knowledge, after reasonable inquiry, of (i) the officers and directors of
the Company, (ii) the officers and directors of the Purchased Companies and
their Subsidiaries that are organized under the laws of a State with the United
States; (iii) the directors of the Purchased Companies and their Subsidiaries
that are organized under the laws of a jurisdiction outside of the United
64
States, and (iv) the individuals holding the positions or exercising the
functions of general manager, managing director or controller (or equivalent
position or function) for each of the Company, the Purchased Companies and their
Subsidiaries and (iii) the individuals listed on Schedule 9.1-A hereto.
"Law" means any federal, state, local or foreign law (including
common law), statute, code, ordinance, rule, regulation or other requirement.
"Legal Proceeding" means any judicial, administrative or arbitral
actions, suits, proceedings (public or private).
"Liability" means any debt, liability or obligation (whether direct
or indirect, known or unknown, asserted or unasserted, absolute or contingent,
accrued or unaccrued, liquidated or unliquidated, or due or to become due, and
whether in contract, tort, strict liability or otherwise).
"Lien" means any lien, pledge, mortgage, deed of trust, security
interest, claim, lease, charge, option, right of first refusal, easement,
servitude, transfer restriction under any shareholder or similar agreement,
encumbrance or any other restriction or limitation whatsoever.
"Managing Board" shall have the meaning ascribed to such term in
Recital C hereof.
"Material Adverse Effect" means (i) a material adverse effect on the
business, assets, properties, results of operations, condition (financial or
otherwise) of the Company, the Purchased Companies and their Subsidiaries, taken
as a whole or (ii) a material adverse effect on the ability of the Company to
consummate the transactions contemplated by this Agreement or perform its
obligations under this Agreement; provided, however, that none of the following,
in and of itself, shall be deemed, either alone or in combination, to constitute
a Material Adverse Effect: (a) any effect, change, event, occurrence or state of
facts relating to the U.S. or the global economy or securities markets in
general that does not (i) specifically relate to or (ii) disproportionately
affect the Company, the Purchased Companies and their Subsidiaries, taken as a
whole, (b) changes or developments in the semiconductor or semiconductor
equipment industry generally, which changes or developments do not
disproportionately affect the Company, the Purchased Companies and their
Subsidiaries, taken as a whole, relative to other participants in the
semiconductor or semiconductor equipment industry; (c) any change in the
Company's stock price or trading volume; (d) any failure by the Company, the
Purchased Companies and their Subsidiaries, taken as a whole, to meet internal
projections or forecasts or published revenue or earnings predictions for any
period ending (or for which revenues or earnings are released) on or after the
date of this Agreement, but not the underlying causes of such failure or the
consequences of such failure; (e) any change of supplier relationships
(including any claims or demands made or Legal Proceedings commenced by any
supplier) or any loss of employees directly resulting from the announcement or
pendency of this Agreement or the Transaction; (f) any effect, change, event,
occurrence or state of facts resulting from any action taken by the Company, the
Purchased Companies or their Subsidiaries with Purchaser's consent or as
expressly required by this Agreement; and (g) the occurrence or non-occurrence
of any event or matter set forth on Schedule 9.1-B hereto.
65
"Material Contracts" shall have the meaning ascribed to such terms
in Section 4.15 hereof.
"Non-Competition Agreement" shall have the meaning ascribed to such
term in Section 7.2(i) hereof.
"Non-U.S. Retirement Plan" shall have the meaning ascribed to such
term in Section 4.16(i) hereof.
"Order" means any order, injunction, judgment, decree, ruling, writ,
assessment or arbitration award by any Governmental Body.
"Ordinary Course of Business" means the ordinary and usual course of
day to day operations of the Business as conducted prior to the date of this
Agreement.
"Outside Date" shall have the meaning ascribed to such term in
Section 3.2(b)(i) hereof.
"Owned Properties" shall have the meaning ascribed to such term in
Section 4.12(a) hereof.
"Permits" means any approvals, authorizations, consents, licenses,
permits or certificates issued or given by any Governmental Body.
"Permitted Exceptions" means (i) statutory liens for current taxes,
assessments or other governmental charges not yet delinquent or the amount or
validity of which is being contested in good faith by appropriate proceedings,
provided full reserves are established therefor to the extent required by GAAP;
(ii) mechanics', carriers', workers', repairers' and similar Liens arising or
incurred in the Ordinary Course of Business that are not material to the
business, operations and financial condition of the property so encumbered or
the Purchased Companies or their Subsidiaries; (iii) zoning, entitlement and
other land use and environmental regulations by any Governmental Body, provided
that such regulations have not been violated; and (iv) such other imperfections
in title, charges, easements, restrictions and encumbrances which do not
materially detract from the value of or materially interfere with the present
use of any Company Property subject thereto or affected thereby.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, unincorporated organization,
Governmental Body or other entity.
"Personal Property Lease" shall have the meaning ascribed to such
term in Section 4.13(a) hereof.
"Purchased Assets" shall have the meaning ascribed to such term in
Section 1.1 hereof.
"Purchased Company" shall have the meaning ascribed to such term in
Recital A hereof.
66
"Purchased Contracts" shall have the meaning ascribed to such term
in Section 1.1(c) hereof.
"Purchaser's Environmental Assessments" shall have the meaning
ascribed to such term in Section 6.10 hereof.
"Real Property Lease" shall have the meaning ascribed to such term
in Section 4.12(a) hereof.
"Reimbursable Costs" shall have the meaning ascribed to such term in
Section 9.4(b) hereof.
"Release" means any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, or leaching into the indoor
or outdoor environment, or into or out of any property.
"Remedial Action" means all actions to (w) clean up, remove, treat
or in any other way address any Hazardous Material; (x) prevent the Release of
any Hazardous Material so it does not endanger or threaten to endanger public
health or welfare or the indoor or outdoor environment; or (y) perform
pre-remedial studies and investigations or post-remedial monitoring and care; or
(z) to correct a condition of noncompliance with Environmental Laws.
"Representatives" shall have the meaning ascribed to such term in
Section 6.6(a) hereof.
"Retained Records" shall have the meaning ascribed to such term in
Section 6.1(b) hereof.
"Revised Calculations" shall have the meaning ascribed to such term
in Section 6.20(c) hereof.
"Revised Statements" shall have the meaning ascribed to such term in
Section 1.5 hereof.
"SEC" shall have the meaning ascribed to such term in Section 4.6(b)
hereof.
"Securities Act" shall have the meaning ascribed to such term in
Section 4.8(a) hereof.
"Shareholder Distributions" shall have the meaning ascribed to such
term in Section 6.20(b) hereof.
"Shares" shall have the meaning ascribed to such term in Recital A
hereof.
"Specified Contracts" shall have the meaning ascribed to such term
in Section 1.2(d) hereof.
67
"Subsidiary" means any Person of which a majority of the outstanding
voting securities or other voting equity interests are owned, directly or
indirectly, by the Company or a Purchased Company.
"Supervisory Board" shall have the meaning ascribed to such term in
Recital C hereof.
"Supplemental Option Plan" shall have the meaning ascribed to such
term in Section 4.3(a) hereof.
"Surtax Liability" shall have the meaning ascribed to such term in
Section 6.20(a) hereof.
"Taxes" means (i) all federal, state, local or foreign taxes,
charges, fees, imposts, levies or other assessments, including, without
limitation, all net income, gross receipts, capital, sales, use, ad valorem,
value added, transfer, franchise, profits, inventory, capital stock, license,
withholding, payroll, employment, social security, unemployment, excise,
severance, stamp, occupation, property and estimated taxes, customs duties,
fees, assessments and charges of any kind whatsoever, (ii) all interest,
penalties, fines, additions to tax or additional amounts imposed by any taxing
authority in connection with any item described in clause (i) and (iii) any
transferee liability in respect of any items described in clauses (i) and/or
(ii).
"Tax Liability Agreement" shall have the meaning ascribed to such
term in Section 6.20(g) hereof.
"Tax Resolution Period" shall have the meaning ascribed to such term
in Section 6.20(g) hereof.
"Tax Returns" means all returns, declarations, reports, estimates,
information returns and statements required to be filed in respect of any Taxes.
"Terminated Company Plans" shall have the meaning ascribed to such
term in Section 6.14(a) hereof.
"Third Party Shares" shall have the meaning ascribed to such term in
Section 4.7 hereof.
"Transaction" shall have the meaning ascribed to such term in
Recital B hereof.
"Transaction Agreements" means, collectively, this Agreement, the
Voting Agreements, the Non-Competition Agreements, the Confidentiality Agreement
the Assignment and Assumption Agreement and the Indemnity Agreement.
"Updated Schedules" shall have the meaning ascribed to such term in
Section 6.12 hereof.
"Voting Agreements" shall have the meaning ascribed to such term in
Recital D hereof.
68
"WARN" shall have the meaning ascribed to such term in Section 4.17
hereof.
"Warrants" shall have the meaning ascribed to such term in Section
4.3(a) hereof.
"Withholding Obligations" shall have the meaning ascribed to such
term in Section 6.20(a) hereof.
"Working Capital" means the aggregate amount of all accounts
receivable and inventory (in each case after reserves established in a manner
consistent GAAP and with the Company's historic practice as reflected in the
Balance Sheet), less the aggregate amount of all accounts payable. Working
Capital shall not include cash and cash equivalents.
(b) Other Definitional and Interpretive Matters. Unless otherwise
expressly provided, for purposes of this Agreement, the following rules of
interpretation shall apply:
Calculation of Time Period. When calculating the period of time
before which, within which or following which any act is to be done or step
taken pursuant to this Agreement, the date that is the reference date in
calculating such period shall be excluded. If the last day of such period is a
non-Business Day, the period in question shall end on the next succeeding
Business Day.
Dollars. Any reference in this Agreement to $ shall mean U.S.
dollars.
Exhibits/Schedules. Any capitalized terms used in any Schedule or
Exhibit but not otherwise defined therein shall be defined as set forth in this
Agreement.
Gender and Number. Any reference in this Agreement to gender shall
include all genders, and words imparting the singular number only shall include
the plural and vice versa.
Headings. The provision of a Table of Contents, the division of this
Agreement into Articles, Sections and other subdivisions and the insertion of
headings are for convenience of reference only and shall not affect or be
utilized in construing or interpreting this Agreement. All references in this
Agreement to any "Section" are to the corresponding Section of this Agreement
unless otherwise specified.
Herein. The words such as "herein," "hereinafter," "hereof," and
"hereunder" refer to this Agreement as a whole and not merely to a subdivision
in which such words appear unless the context otherwise requires.
Including. The word "including" or any variation thereof means
"including, without limitation" and shall not be construed to limit any general
statement that it follows to the specific or similar items or matters
immediately following it.
(c) The parties hereto have participated jointly in the
negotiation and drafting of this Agreement and, in the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as jointly drafted by the parties hereto and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of any
provision of this Agreement.
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9.2 Non-Survivability of Representations and Warranties.. The
respective representations and warranties and the pre-Closing covenants of the
Company and the Purchaser contained in this Agreement or in any instrument
delivered pursuant to this Agreement shall expire with, and be terminated and
extinguished upon, the Effective Time. This Section 9.2 shall have no effect
upon any obligations of the parties hereto to be performed after the
consummation of the Transaction.
9.3 Payment of Sales, Use or Similar Taxes. All sales, use,
transfer, intangible, recordation, documentary stamp or similar Taxes or
charges, of any nature whatsoever, applicable to, or resulting from, the
transactions contemplated by this Agreement shall be borne by the Purchaser.
9.4 Expenses.
(a) Except as otherwise provided in this Agreement, the Company and
the Purchaser shall each bear its own costs and expenses incurred in connection
with the negotiation and execution of this Agreement and each other agreement,
document and instrument contemplated by this Agreement and the consummation of
the transactions contemplated hereby and thereby.
(b) Notwithstanding Section 9.4(a), the Purchaser shall reimburse
the Company for reasonable costs and expenses incurred by the Company arising
after the Effective Time that are reasonably necessary for the dissolution and
liquidation of the Company and the continued existence of the Company through
the date of the final liquidation of the Company. ("Reimbursable Costs") in an
aggregate amount up to Two Million Seven Hundred Fifty Thousand Dollars
($2,750,000). Upon presentation of documentation reasonably satisfactory to the
Purchaser, the Purchaser shall promptly reimburse the Company in up to three (3)
tranches: (i) upon the incurrence of the first One Million Dollars ($1,000,000)
in Reimbursable Costs, (ii) upon the incurrence of the next One Million Dollars
($1,000,000) in Reimbursable Costs; and (iii) upon the incurrence of the last
Seven Hundred Fifty Thousand ($750,000) in Reimbursable Costs. In the event that
the final amount of the Reimbursable Costs is a portion of any tranche, the
Purchaser shall reimburse the Company for such portion upon presentation of such
final documentation reasonably satisfactory to the Purchaser. The Company shall
use its commercially reasonable efforts to minimize the amount of Reimbursable
Costs.
9.5 Specific Performance. The parties acknowledge and agree that
the breach of this Agreement would cause irreparable damage and that the parties
will not have an adequate remedy at law. Therefore, the respective obligations
of the parties under this Agreement, including, without limitation, the
Company's' obligation to sell the Shares to the Purchaser, shall be enforceable
by a decree of specific performance issued by any court of competent
jurisdiction, and appropriate injunctive relief may be applied for and granted
in connection therewith. Such remedies shall, however, be cumulative and not
exclusive and shall be in addition to any other remedies which any party may
have under this Agreement or otherwise.
9.6 Further Assurances. The Company and the Purchaser each agrees
to execute and deliver such other documents or agreements and to take such other
action as may be
70
reasonably necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
9.7 Submission to Jurisdiction; Consent to Service of Process;
(a) The parties hereto hereby irrevocably submit to the
non-exclusive jurisdiction of any federal or state court located within the
County of Santa ▇▇▇▇▇ in the State of California over any dispute arising out of
or relating to this Agreement or any of the transactions contemplated hereby and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such dispute. Each of the parties
hereto agrees that a judgment in any such dispute may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
(b) Each of the parties hereto hereby consents to process being
served by any party to this Agreement in any suit, action or proceeding by the
mailing of a copy thereof in accordance with the provisions of Section 9.10.
9.8 Entire Agreement; Amendments and Waivers. This Agreement
(including the schedules and exhibits hereto) and the remainder of the
Transaction Agreements represent the entire understanding and agreement between
the parties hereto with respect to the subject matter hereof and thereof, and
this Agreement can be amended, supplemented or changed, and any provision hereof
can be waived, only by written instrument making specific reference to this
Agreement signed by the party against whom enforcement of any such amendment,
supplement, modification or waiver is sought. No action taken pursuant to this
Agreement, including without limitation, any investigation by or on behalf of
any party, shall be deemed to constitute a waiver by the party taking such
action of compliance with any representation, warranty, covenant or agreement
contained herein. The waiver by any party hereto of a breach of any provision of
this Agreement shall not operate or be construed as a further or continuing
waiver of such breach or as a waiver of any other or subsequent breach. No
failure on the part of any party to exercise, and no delay in exercising, any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of such right, power or remedy by such party
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All remedies hereunder are cumulative and are not
exclusive of any other remedies provided by law.
9.9 Governing Law. This Agreement shall be governed by and
construed in accordance with the Laws of the State of California without
reference to such state's principles of conflict of laws, except that provisions
of this Agreement related to the fiduciary duties of the Company Boards shall be
governed by and construed in accordance with the Laws of The Netherlands without
reference to such jurisdiction's principles of conflict of laws. The Company and
the Purchaser agree that none of the Transaction Agreements may be dissolved
pursuant to Section 6:265.1 of the Dutch Civil Code.
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9.10 Table of Contents and Headings. The table of contents and
section headings of this Agreement are for reference purposes only and are to be
given no effect in the construction or interpretation of this Agreement.
9.11 Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered
personally or mailed by certified mail, return receipt requested, to the parties
(and shall also be transmitted by facsimile to the Persons receiving copies
thereof) at the following addresses (or to such other address as a party may
have specified by notice given to the other party pursuant to this provision):
If to the Company, to:
Metron Technology N.V.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Cooley Godward LLP
5 Palo Alto Square
▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser, to:
Applied Materials, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, M/S 2064
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Applied Materials, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, M/S 0105
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
72
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
9.12 Severability. If any provision of this Agreement is invalid or
unenforceable, the balance of this Agreement shall remain in effect.
9.13 Binding Effect; Assignment. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
permitted assigns. Nothing in this Agreement shall create or be deemed to create
any third party beneficiary rights in any person or entity not a party to this
Agreement except as provided below. No assignment of this Agreement or of any
rights or obligations hereunder may be made by either the Company or the
Purchaser (by operation of law or otherwise) without the prior written consent
of the other parties hereto and any attempted assignment without the required
consents shall be void; provided, however, that the Purchaser may assign this
Agreement and any or all rights or obligations hereunder (including, without
limitation, the Purchaser's rights to purchase the Shares) to any Affiliate of
the Purchaser. Upon any such permitted assignment, the references in this
Agreement to the Purchaser shall also apply to any such assignee unless the
context otherwise requires.
9.14 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
** REMAINDER OF PAGE INTENTIONALLY LEFT BLANK**
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IN WITNESS WHEREOF, the parties hereto have caused this Stock and
Asset Purchase Agreement to be executed by their respective officers thereunto
duly authorized, as of the date first written above.
APPLIED MATERIALS, INC., a Delaware
corporation
By: _______________________________________
Name:
Title:
METRON TECHNOLOGY N.V., a corporation
organized under the laws of
The Netherlands:
By: _______________________________________
Name:
Title: